• Tips gratefully accepted here. Thanks!:

  • Recent Comments

    Shadowfax on Focus, people. 
    bellecat on Focus, people. 
    riverdaughter on Focus, people. 
    Greg on Focus, people. 
    Shadowfax on Ascendant Madoka Help Us
    Shadowfax on Ascendant Madoka Help Us
    Shadowfax on Ascendant Madoka Help Us
    pm317 on Ascendant Madoka Help Us
    bellecat on Ascendant Madoka Help Us
    bellecat on Ascendant Madoka Help Us
    bellecat on Ascendant Madoka Help Us
    bellecat on Ascendant Madoka Help Us
    Shadowfax on Ascendant Madoka Help Us
    Shadowfax on Ascendant Madoka Help Us
    Shadowfax on Ascendant Madoka Help Us
  • Categories


  • Tags

    abortion Add new tag Afghanistan Al Franken Anglachel Atrios bankers Barack Obama Bernie Sanders big pharma Bill Clinton cocktails Conflucians Say Dailykos Democratic Party Democrats Digby DNC Donald Trump Donna Brazile Economy Elizabeth Warren feminism Florida Fox News General Glenn Beck Glenn Greenwald Goldman Sachs health care Health Care Reform Hillary Clinton Howard Dean John Edwards John McCain Jon Corzine Karl Rove Matt Taibbi Media medicare Michelle Obama Michigan misogyny Mitt Romney Morning Edition Morning News Links Nancy Pelosi New Jersey news NO WE WON'T Obama Obamacare OccupyWallStreet occupy wall street Open thread Paul Krugman Politics Presidential Election 2008 PUMA racism Republicans research Sarah Palin sexism Single Payer snark Social Security Supreme Court Terry Gross Texas Tim Geithner unemployment Wall Street WikiLeaks women
  • Archives

  • History

    January 2017
    S M T W T F S
    « Dec    
    1234567
    891011121314
    15161718192021
    22232425262728
    293031  
  • RSS Paul Krugman: Conscience of a Liberal

  • The Confluence

    The Confluence

  • RSS Suburban Guerrilla

  • RSS Ian Welsh

    • The CIA vs. Trump
      Or, perhaps I should say, the intelligence community vs. Trump. Let us be clear, that the left is against Trump and that the intelligence community is against Trump should not mean, to anyone with sense, that the CIA, NSA or any other alphabet soup agency is good, or noble or our friend. It just means […]
  • Top Posts

Geithner and Summers: Economic Disaster Deja Vu

g + s

Timothy Geithner’s profanity-laced rant against Sheila Bair and Mary Shapiro for their rational, reality-based concerns about increasing the power of Federal Reserve Bank, as opposed to increasing oversight of the system, should elicit a kind of déjà vu because the scenario has been played before. (Note: Increasing oversight does not mean policy disclosure.)

In 1997-8, Brooksley Born, the head of the Commodities Futures Trading Commission, tried to open a discussion about introducing oversight measures into the OTC derivatives market by producing a memo because she could see that:

“There was no transparency of these markets at all. No market oversight. No regulator knew what was happening,” Born says. “There was no reporting to anybody.”

Summers, Rubin’s deputy (and now director of the National Economic Council), said the memo had “cast the shadow of regulatory uncertainty over an otherwise thriving market, raising risks for the stability and competitiveness of American derivative trading.”

History, in the form of the role these derivatives played in this economic disaster, has proven that she was right to undertake that initiative. Unfortunately, Greenspan, Leavitt, Rubin, and Summers, to name some major players, were effective in pushing legislation that ended the CFTC’s ability to undertake oversight.

Born assailed the legislation, calling it an unprecedented move to undermine the independence of a federal agency. In eerily prescient testimony, she warned of potentially disastrous and widespread consequences for the public. “Losses resulting from misuse of OTC derivatives instruments or from sales practice abuses in the OTC derivatives market can affect many Americans,” she testified that July. “Many of us have interests in the corporations, mutual funds, pension funds, insurance companies, municipalities and other entities trading in these instruments.”

Notwithstanding, her concerns were dismissed and her ominous predictions came to pass.

Geithner is a protégé of Summers.

Is it not an ironic twist of fate, and a testament to Geithner’s blind faith against oversight, that he, like his mentor before him, is assailing intelligent, moral, qualified women for pointing out the  folly of his ways.

{Note: I defer all economic inquiries to our resident expert, Dakinikat.  My interest in the situation is the social dynamic.}

Digg!!! Share!!! Tweet!!!

Add to FacebookAdd to DiggAdd to Del.icio.usAdd to StumbleuponAdd to RedditAdd to BlinklistAdd to TwitterAdd to TechnoratiAdd to FurlAdd to Newsvine

Add to: Facebook | Digg | Del.icio.us | Stumbleupon | Reddit | Blinklist | Twitter | Technorati | Furl | Newsvine