Treasury asks for control of derivatives market: "In a two-page letter sent Wednesday to congressional leaders, Treasury Secretary Timothy Geithner said he wants to create a central electronic-based system that would track the buying and selling of derivatives. He also wants to ensure that financial firms selling the instruments have enough capital on hand in case they default and subject them to stringent standards of conduct and new reporting requirements."
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Is there any aspect of the economy that the federal government does NOT want to control?
3 comments:
Why on earth would you be opposed to regulation of derivatives, when you look at the situation that the deregulated state of derivatives has gotten us into?
The current state of affairs amounts to a) casino gambling in lieu of a market and b) massive circumvention of insurance regulation amounting to outright fraud.
There's a basic rule of law and stability argument in favor of regulation.
To advocate otherwise not only debases the rule of law, it is insane. Period.
Undoubtedly certain practices need to be prohibited. But I will be surprised if Geither wants to stop there. My point is that there seems to be no area of the economy that they do not want to control. Not just regulate--control.
And bad regulation is every bit as disastrous as no regulation. To argue that deregulation of derivatives is the sole reason for the recession ignores the equally important role of horribly failed government regulation of mortgage lending.
Which is more insane--to believe in totally unregulated markets (which I agree is nuts) or to believe that federal regulators can micromanage auto companies, banks, insurance companies, the medical profession, and who knows what else?
With a name like that, me thinks it should be annexed into the Vatican city state to exorcise the evil greedmongers who control it.
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