Monday, June 22, 2009

Consensus building, with permission

Obama is pounding the drum of financial reform. Yes sir! He’s going to show the crooks that ruined our economy a thing or two.

If they agree.

It’s called consensus building.

His cop is going to be the same enablers who held the door while their cronies looted the Treasury—the Fed.

The comedy team of Geithner & Summers gave us a blueprint for Obama’s planned reform in a Washington Post op ed.

Commenting on the op-ed, Henry C K Liu says, “[The] administration’s regulatory reform plan is generally viewed as having backed away, due to the political difficulties involved, from a more extensive structural overhaul…”

Once again, the ruling party gingerly creeps forward on hands and knees, being ever so careful not to rock the boat or to cause their patrons any undue stress. Congress wouldn’t stand for it; Geithner & Summers wouldn’t stand for it, and most importantly of all, Goldman Sachs wouldn’t allow it.

To Congress, corporatism is the goose that lays the golden egg. To the rest of us, it’s road kill. That’s why we’re shut out of the process.

The happy duo promises us that they will increase the capital reserve requirements for “the largest and most interconnected firms.”

“Not a problem,” their handlers tell them. "All we need do is revise our arcane mark-to-models and through the magic of second-rate mathematical manipulation, presto!, we have all the reserves we need to float another bubble.”

Reform is not about reform, it’s about spin and window dressing. Wall Street and the Beltway are locked in an intricate tango in which Wall Street may allow a little dry humping, but that is as far as it will go.

The important thing is to have this window dressing in place so it can be unveiled when the next financial crisis hits and private ruin is magically transformed into public ruin.

Obama is just too damn polite. FDR grabbed Wall Street by it short hairs; Obama is holding it hand. The only question is, how bad will it have to get before Obama goes for their groin?

That’s how you build consensus.


Suzan said...

Oh, how about "not anywhere close to bad enough" since they put him in office in order to blunt the public furor with the status quo?

And he's done a pretty good job for them so far.

The only question is, how bad will it have to get before Obama goes for their groin?


Case Wagenvoord said...

"Bad" could well be a complete social and economic meltdown.

The Cleansing Fire said...

Case have you read Karl Denniger's Market Ticker? /
Some great stuff there

Case Wagenvoord said...

Thanks, Clensing Fire. There is, indeed, some good material on this site. I'll link to it when I have a chance.