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The criminal actions[1] of Wachovia, Lloyds, Credit Suisse, Barclays, HSBC, et al have shown that the megabanks cannot be trusted to follow existing laws. The

The criminal actions[1] of Wachovia, Lloyds, Credit Suisse, Barclays, HSBC, et al have shown that the megabanks cannot be trusted to follow existing laws. The robo-signing debacle[2] has demonstrated amply that the financial sector can't be bothered to verify their data before destroying the lives of thousands of people. The LIBOR manipulation scandal[3] proves that even the industry's own measuring rods are bent and unreliable. The last 5 years have revealed an industry rife with crime, deceit, and unabashed greed which has severely damaged the global economy and the quality of life for hundreds of millions of people. And the penalties for these actions pale in proportionate comparison to those imposed on a street-level drug dealer. When a private enterprise becomes too essential to regulate effectively, it endangers the society in which it operates. Breaking it up into manageable chunks is the only viable option. [1]: https://www.nytimes.com/2013/01/03/opinion/how-bankers-help-drug-traffickers-and-terrorists.html https://www.nytimes.com/2013/01/03/opinion/how-bankers-help-... [2]: https://en.wikipedia.org/wiki/2010_United_States_foreclosure_crisis https://en.wikipedia.org/wiki/2010_United_States_foreclosure... [3]: https://en.wikipedia.org/wiki/Libor_scandal https://en.wikipedia.org/wiki/Libor_scandal

stretchwithme 14y ago
The real problem is that they are successful in duping governments to underwrite the risks they take. And they LEGALLY influence legislators to rewrite laws so they can LEGALLY take more risks. And when things blow up, they LEGALLY influence them again to get bailouts. The incidents you cite above happened to exploit the fact that there is someone who will absorb all the risks of otherwise unprofitable practices.
snitko 14y ago
I always remember what Milton Friedman used to say, he was amazed be people who see failure of regulation and propose a fix by seeking to introduce even more regulation. "well this time it will surely work!" "if only we had the right kind of regulation/people in charge!" they say. That's never gonna happen. Breaking the system in chunks artificially will not work, because it will consolidate again and buy up the regulators. The true solution here is Bitcoin, precisely because it is not controlled by anyone.
- lwat 14y ago
  I used to be an Austrian but it's been almost a century now and it's become clear to me that the Keynesians are actually correct. Even after the GFC things bounced back very quickly. The power to inflate away old debt is too useful to sacrifice.
  - snitko 14y ago
    Hm, it's interesting, would you care to elaborate: what do you mean by "too useful"? Too useful for whom?
    - lwat 14y ago
      Well let me put it this way: If the USA kept the gold standard, I seriously doubt they'd be the number 1 economy in 2013.
      - snitko 14y ago
        But you're not explaining your claim. How can possibly printing money can make society as a whole richer? It can make certain individuals better off, for sure (the ones who receive the newly created money first while the prices are low). But how does it make the economy as a whole better off? No additional value gets created.
        Bricejm 14y ago
        I think the point is inflation increases the money supply, while debt remains the same. Individuals make more money with less buying power, but can pay off debt easier.
        mtgx 14y ago
        In the mean time the average real salary has been dropping since 1969, because of inflation, and because the government and companies didn't bother to increase the minimum and average wages to keep pace with the inflation. So I really doubt most of the population benefits from inflation.

stretchwithme 14y ago

The real problem is that they are successful in duping governments to underwrite the risks they take. And they LEGALLY influence legislators to rewrite laws so they can LEGALLY take more risks. And when things blow up, they LEGALLY influence them again to get bailouts. The incidents you cite above happened to exploit the fact that there is someone who will absorb all the risks of otherwise unprofitable practices.

snitko 14y ago

I always remember what Milton Friedman used to say, he was amazed be people who see failure of regulation and propose a fix by seeking to introduce even more regulation. "well this time it will surely work!" "if only we had the right kind of regulation/people in charge!" they say. That's never gonna happen. Breaking the system in chunks artificially will not work, because it will consolidate again and buy up the regulators. The true solution here is Bitcoin, precisely because it is not controlled by anyone.

lwat 14y ago
I used to be an Austrian but it's been almost a century now and it's become clear to me that the Keynesians are actually correct. Even after the GFC things bounced back very quickly. The power to inflate away old debt is too useful to sacrifice.
- snitko 14y ago
  Hm, it's interesting, would you care to elaborate: what do you mean by "too useful"? Too useful for whom?
  - lwat 14y ago
    Well let me put it this way: If the USA kept the gold standard, I seriously doubt they'd be the number 1 economy in 2013.
    - snitko 14y ago
      But you're not explaining your claim. How can possibly printing money can make society as a whole richer? It can make certain individuals better off, for sure (the ones who receive the newly created money first while the prices are low). But how does it make the economy as a whole better off? No additional value gets created.
      - Bricejm 14y ago
        I think the point is inflation increases the money supply, while debt remains the same. Individuals make more money with less buying power, but can pay off debt easier.
        mtgx 14y ago
        In the mean time the average real salary has been dropping since 1969, because of inflation, and because the government and companies didn't bother to increase the minimum and average wages to keep pace with the inflation. So I really doubt most of the population benefits from inflation.