For John, BLUF: Nobody does, or should, trust Wall Street. Nothing to see here; just move along.
For Christmas Nation of Change gave us an article on Senator Bernie Sanders and the Financial Industry. The writer was Mr Andrew Emett and the article was "Bernie Sanders Attacks Wall Street and The Fed". It isn't like Wall Street and the Fed don't need to be attacked. Just the concept of "too big to fail" should cause all, Republican, Democrat and those who decline to state, to shudder.
My concern about Senator Sanders as a Presidential Candidate is that I don't know where his stop line is. What are his real goals, after he gets elected and gives us "reform" of the Federal Reserve Bank and Wall Street? Is he a central planning fan♠ or does he just want to see a little more federal control of the financial markets.
But, to the article:
In a New York Times op-ed published on Wednesday, Sen. Bernie Sanders warned taxpayers that they could be responsible for paying another, larger bailout if the Federal Reserve is not immediately restructured to eliminate conflicts of interest with Wall Street. Accusing the foxes of guarding the henhouse, Sen. Sanders demanded transparency and reforms to prevent commercial banks from gambling with Americans’ bank deposits.Here is the final paragraph of the article:
“Wall Street is still out of control,” Sanders warned. “Seven years ago, the Federal Reserve and the Treasury Department bailed out the largest financial institutions in this country because they were considered too big to fail. But almost every one is bigger today than it was before the bailout. If any were to fail again, taxpayers could be on the hook for another bailout, perhaps a larger one this time.”
“Financial reforms must not stop with the central bank,” Sanders explained. “We must reinstate Glass-Steagall and break up the too-big-to-fail financial institutions that threaten our economy. But we need to start with fundamental change. The sad reality is that the Federal Reserve doesn’t regulate Wall Street; Wall Street regulates the Fed. It’s time to make banking work for the productive economy and for all Americans, not just a handful of wealthy speculators. And it begins by making the Federal Reserve a more democratic institution, one that is responsive to the needs of ordinary Americans rather than the billionaires on Wall Street.”I think the Socialist is right about Glass-Steagall needing to be reinstated. And, a little more insight into the Federal Reserve, but I think we need to tread carefully. We don't need to kill the goose that lays the golden eggs. Put another way, we don't want to turn into Venezuela. There, a better life was promised by the Socialists, who then managed to trash the economy. Thus, I want to learn a little more about the path down which Senator Sanders intends to lead us. Maybe Democrat Party Chair Debbie Wasserman Schultz can help us out here. Or not.
Regards — Cliff
♠ Per Wikipedia, Central Planning operates "As a coordinating mechanism for socialism, economic planning substitutes factor markets and is defined as a direct allocation of resources; contrasted with the indirect allocation mechanism of the market." In stead of letting some combination of store managers and Walmart buyer in Bentonville, Arkansas, plus some buyer for Home Depot and for Lowes and for Ace, plus managers for a bunch of individual hardware stores, decide how many rubber mallets to buy this year, we let some person in the Federal Government decide for the whole nation. Sounds easy. If Sam Walton could do it, why not some Federal GS-11 with a Masters Degree in public planning?