We have a "Financial FDA" It's called the Securities and Exchange Commission. We don't need another, overlapping Gov't agency and we don't need a rush job of onerous legislation along the lines of Sarbanes Oxley. We need the regulations we have and the SEC we have to work more effectively.

The problem was that the housing bubble and subprime mortgages made the Gov't happy. Housing prices were rising, increasing net wealth -- always a good thing. At the same time, the subprime mortgages meant that home ownership was increasing. This was good because home ownership, through mortgages is the main vehicle for asset accumulation for the middle class. Now, pooerer people could take advantage of this great system. In short, Americans were getting richer and more people were moving into the middle class.

Who wants to be the party pooper at such a great party?

Wouldn't that have taken care of everything?

How quickly we forgot the lessons of the 1929 Crash. The government wisely instituted controls over the financial sector in the early 1930s to prevent another disaster of that sort. As a result, banks could no longer speculate at will. But then the deregulation craze took hold. Deregulating air traffic only caused many airlines to give up the ghost, deregulating the telephone system only caused higher prices and mass confusion, deregulating the energy sector only caused black outs. But deregulating the financial sector produced one bubble after another and gave speculators immense profits. Banks paid their employees indecent bonuses while business boomed. Now that the last bubble has burst and the house of cards is threatening to collapse, those who paid lip service to private enterprise and a market economy are expecting the much maligned government to bail them out. It would indeed be great if those who made multi-million profits could be made to pay for the disaster.

There is something wrong with that picture. But perhaps the next administration and Congress will have learned a lesson and make the laws needed to ensure a stable finance system - even if this means less windfall profits. Then we may be safe for another 60 years, when the next generation may have to relearn the same lesson.

Karl Marax argued that capitalism would ultimately fail because of greed and the move to monopoly control of industry. He didn't take into account democratic capitalism that this country created so that the capitalism of Marx ceased to exist. Until the Republicans took control of Congress and the White House.

A guy who has seven homes would NEVER get it. Old Senator Forrestal is as much a loose cannon now as he was in the Navy. If the American public falls for this crap I think I might just have to move to Canada. Jesus, Mary & Joseph!

I found the answer to a question I submitted to Andrew Leonard, on this thread.

I was interested in Phil Gramm's tactics in getting some of these deregulation measures through congress. My interest was based on the fact that after eight years of Bush/Cheney/etc I have absolutely no trust for the republican party and their supporters -- I was noticing more and more republicans say that these deregulation pieces were passed during "the Clinton era."

Here's what I found: From an article in Mother Jones titled "Foreclosure Phil"...and excerpt...

...But Gramm's most cunning coup on behalf of his friends in the financial services industry—friends who gave him millions over his 24-year congressional career—came on December 15, 2000. It was an especially tense time in Washington. Only two days earlier, the Supreme Court had issued its decision on Bush v. Gore. President Bill Clinton and the Republican-controlled Congress were locked in a budget showdown. It was the perfect moment for a wily senator to game the system. As Congress and the White House were hurriedly hammering out a $384-billion omnibus spending bill, Gramm slipped in a 262-page measure called the Commodity Futures Modernization Act. Written with the help of financial industry lobbyists and cosponsored by Senator Richard Lugar (R-Ind.), the chairman of the agriculture committee, the measure had been considered dead—even by Gramm. Few lawmakers had either the opportunity or inclination to read the version of the bill Gramm inserted. "Nobody in either chamber had any knowledge of what was going on or what was in it," says a congressional aide familiar with the bill's history....

http://www.motherjones.com/news/feature/2008/07/foreclosure-phil.html

This brings to mind all the lives that have been lost in the war against terrorism. Seems to me that the terrorists are right here at home -- and getting richer by the minute.