You Must Read The Occupiers' 325-Page Comment To The SEC
The Occupy people have done a wonderful thing. On Monday, just as the comment period on the new regulation was closing, a subgroup of seven known as Occupy the SEC submitted a 325-page comment to all relevant federal agencies demanding a stricter "Volcker Rule" -- the part of Dodd-Frank that aims to limit the amount of proprietary trading, or risky bets made with a firm's own money (frequently and ultimately meaning YOUR money), in which megabanks can participate.
This is Important, as the comment explains:
Proprietary trading by large-scale banks was a principal cause of the recent financial crisis, and, if left unchecked, it has the potential to cause even worse crises in the future. In the words of a banking insider, Michael Madden, a former Lehman Brothers executive:Proprietary trading played a big role in manufacturing the CDOs (collateralized debt obligations) and other instruments that were at the heart of the financial crisis. . . if firms weren't able to buy up the parts of these deals that wouldn't sell. . .the game would have stopped a lot sooner.
Go read it! We haven't read the full thing, but we will... later. (No, that's not even a joke this time. We will read it later! Unless something good comes on the teevee... No but really we look forward to reading it! Maybe...)
In the meantime, here are a couple of reviews from Reuters and Mother Jones.