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On this past Sunday’s Meet the Press, Bill Clinton was praising John McCain, while going out of his way not to say anything really laudatory regarding Obama.
In this interview in Business Week, Clinton goes further by defending the repeal of Glass-Steagall by stating: "No, because it wasn’t a complete deregulation at all."
Not helpful, Bill.
Now the Wall Street Journal Editorial Board has taken that ball and run with it.
The most choice statements in that editorial, 2 in succession:
"The least regulated of our financial institutions — hedge funds — have posed the least systemic risks in the current panic. The big investment banks that got into the most trouble could have made the same mortgage investments before 1999 as they did afterwards."
This perpetuates the lie, that McCain is advancing, that this is a credit crisis, not an asset crisis. The reason banks won’t lend to each other is because they don’t know is the value of the assets they are holding as collateral.
My limited understanding regarding Mortgage Backed Securities and Collateral Debt Obligations is that those instruments would not have passed muster with the regulatory agencies who provide the oversight. (of course said agency would actually have to want to provide oversight, but that’s a whole other story inherent to the Bush Administration)
Furthermore, one of the reasons AIG had to be bailed out is because they provided insurance on said derivatives. [Any economists out there, feel free to correct me]
As an aside, of note in the Business Week article is that Robert Rubin is an advisor to the Obama campaign. If anyone was wondering why Obama was supporting any kind of bail out package (along with his association with Chicago School economists) that aids Wall Street, look no further than there.
8 Comments
*sigh*
(thanks for the diary)
The Bill Clinton non-support of Obama was the subject of the Bill Press Show this morning, which I listen to on my way to work these days.
I personally don’t think that, in grand scope of things, Bill Clinton’s non-support is not a game breaker by any stretch of the imagination, but it does paint a picture where the DLC stands in general.
It’s all about the Clintons. I noticed the non support a while ago and I’m gratified to know others have too. Thom Hartmann noted on Monday that Bill knows people vote on personality mostly and only sometimes on issues. so he’s not helping when he says he likes McCain (gotta question his judgment there) but likes Obama on the issues.
jeez. Obama must be glowing. /s
With your diary post I’m disgusted to realize that Clinton was for deregulation as much as goopers. I was never a Clinton fan and now this just clinches it. If Bubba likes phil gramm no wonder he likes mccain. I’m glad I didn’t support Hillary. They’re really in the tank for corporate elite.
F***!!! Bill Clinton. Worthless bastard.
The hell with him for signing the Glass-Leach-Bliley Act. Nice going, Bill “God bless the GOP” Clinton.
Yeah, Phil Gramm’s a great guy, Bill! He voted to throw you out of office, remember? He derailed your health care plan, Bill! Great guy, Phil Gramm!
Remember, Bill said John McCain would make a great president. He said that during the primary.
I agree with you 1000%. Him and the banks.
What we’re seeing right now is a consolidation in the financial sector that goes back to before the Jekyll Island meeting in 1910 when the Fed was formed. The bankers are pushing to go back to pre-Sherman Antitrust Act days.
Capitalism is in crisis and as long as the powers that be continue to ignore the people who are trying to keep their homes and make sure that their kids have a future and that there is opportunity for everyone in the country, not just Skull and Bones elitists and fundamentalist whackos, I say let the whole system implode.
Either that or let’s get ready for another civil war. This shit has to stop.
MBS and CDO are acceptable securities. They are however, unable to be valued right now. The more defaulted mortgages there are, the less these securities are worth. Mortgages aren’t even close to hitting bottom in terms of default rates, so one can buy or sell the MBS and CDOs.
…So, it is impossible to mark them to market or accurately impair their asset value. These losses can and have flowed through income statements which lead to downgrades in credit rating of the security holders. Downgrades require more collateral (cash) to be posted per the banking regulations and swap contract provisions. This is why AIG needed the $85 Billion. They were getting downgraded and per the insurance contracts (Credit Default Swaps) they wrote on the CDO, MBS and many other underlying assets, AIG was having to post $85 Billion or get defaulted by their counterparties.
T-
They are however, unable to be valued right now
So, is my point correct that, since these securities cannot be valued that, if they were to be bought and sold, the regulatory agency could throw the flag on the buying, selling and/or trading?
In other words, shouldn’t there be regulations in the first place which handle the valuation of these securities, especially the Credit Default Swaps?
I noticed that several members of the very short honor roll of Senators who voted against Gramm-Leach-Bliley in 1999 remained on the honor roll of those voting against the bailout bill: Feingold, Wyden, and Dorgan.