Senate Decides To REWARD Big Banks For Criminal Behavior

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Опубликовано 12 марта 2018, 14:00
The Senate passed legislation this week that will repeal protections that had been put in place with the Dodd-Frank Act. This move will leave us vulnerable to even more criminal activity from America's biggest banks. Ring of Fire's Mike Papantonio and Peter Mougey discuss this.

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The Senate passed legislation this week that's going to repeal protections that had been put in place with the Dodd-Frank Act. This move is going to leave us vulnerable, even more criminal activity is going to take place with America's biggest bank. Now, Peter, this is right up your alley after the first theft by the big banks, they stole gazillions of dollars from the American public. You brought lawsuits against some of those thieves. You brought hundreds of lawsuits against those thieves. Shearson Lehman, they escaped totally, right? Shearson Lehman, if you lost $100,000 because of Shearson Lehman fraud, you maybe got back $15,000.

Right.

That was kind of the ratio. And then taxpayers came in they really bailed out these other organizations. So talk about this a little bit. We got Congress saying, "You know, we need to do this again." That's basically what this is advising. Let's do this.

To really kind of frame this up. The Dodd-Frank Act came out right after the huge market meltdown in 2007 and 2008, and that market meltdown was built on Wall Street greed. Essentially taking risk that benefited CEOs, senior management, but that risk was shoved on to shareholders and ultimately American taxpayer. So right after that decline, Congress, the Obama administration put in all kinds of safeguards. It said kind of too big to fail. So there were all these tests, and let's use one because it's kind of an easy one. Stress tests. Stress tests are the banks run and they say, "I'll tell you what, we're going to run this stress." What happens if the economy collapses? What happens if inflation, the dollar, it comes in and it tests and stress the banks and says, "Where are your weak spots?"

It's costly, it takes some time, but it's very, very ... It protects the American consumer and makes sure that the banks aren't taking too much risks. Well, Wall Street's done a phenomenal job. The banks had done a great job, employed thousands of lobbyists, spends hundreds of millions of dollars lobbying. So Dodd-Frank never really gets implemented. Just small bits and pieces of it. So now fast forward all the way to the new proposed bill.

Back up just a second. People don't even realize it. They think Dodd-Frank is out there, but, no, Wall Street has stopped it at every turn.

Oh, yeah.

Every turn. So we don't even have the full benefit of Dodd-Frank.

Not even a fraction of it. There was hundreds and hundreds of proposals. A small, tiny amount of them were passed mostly because Wall Street beat them back through lobbying.

Okay. This is one proposal.

It's an argument though, which always drives me nuts. The argument is, oh, these are too costly. These are too expensive. They're too time consuming. It slows down growth, it impedes lending, it restricts capital. But at the same time, I mean, how many trillions of dollars were caused by Wall Street's greed in the '07 and '08 collapse? So now what they've done is that Senator Mike ... It is Crappo, Crapo?

Crapo.

Crapo. I always forget how to pronounce his name. Maybe Crappo but might be a little better.

Crappo's pretty appropriate, yeah.

He's the chairman of the Senate Committee of Banking and they're pushing this back and effectively. It looks like they got enough votes. They need 60 votes. [crosstalk 00:03:15]

What about this, Peter? What about this? Now, look, the thing that you've talked about so much when you bring these lawsuits in your pleadings, you talk about wild risks.

Right.

You talk about the idea that these banks understood the wild risk that was involved, but the risk, taking those wild risks, puts so much money in their pocket. And at the end of the day, after they've lost all the money, with sheer incompetence and greed. There's no other reason. They were incompetent fools along with being greedy fools. So after they lose this money, the taxpayers come in, they bail them out and they get to keep all the money they made. The CEOs keep every little dime. There's a second part to this that really bothers me. Now, you talked about there needed to be under Dodd-Frank, this small part of Dodd-Frank, is the stress test.
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