Juggling Dynamite

Brooksley Born is the lawyer who was chairperson of the Commodity Futures Trading Commission from August 1996 to June 1999 when she lobbied Congress to give the CFTC oversight of the off-exchange markets for Derivatives.  In doing so she became enemy number one of the financial sector and their representatives, Treasury Secretary Robert Rubin, Larry Summers, and Fed Chair Alan Greenspan. Her battle for transparency and prudent controls in this area,  was profiled in the 2010 FRONTLINE expose, “The Warning”, which is excellent and can be viewed here.  In the end, the bankers won, Congress rejected regulation of the derivatives market, and Born resigned.

In her talk this week at the Finance & Society conference, Born updated on the ongoing battle to bring Wall Street under the rule of law.  And warned about “the fallacious beliefs championed notably by Alan Greenspan that financial markets are self regulating and that financial firms are capable of policing themselves.” Here is a direct video link to her speech on Wednesday (which starts at 6:32 on the play bar) It is followed by some excellent comments by Anat Admati, professor of finance and economics at Stanford University, who helped organize the conference, and then a discussion between the two.  All well worth watching.  Honest assessments by such knowledgeable insiders in finance, are rare and valuable. (Born’s talk starts at 6:32 on the play bar)

Author and Wall Street historian, Nomi Prins, has researched and documented the facts entwining bankers and politicians in patient detail. Her conclusion is that Hillary Clinton is likely to be just as supportive of the finance cartel as her husband was before her.

Lest we forget, it was Bill Clinton who signed the bill that repealed the Glass Steagall Act in 1999; much to the joy of applauding bankers.  We, the people, have been paying the price ever since.

See more detail on all of this here: Wall Street owns the Clintons: why Hillary can’t outrun her husband’s presidency

“To grasp the dangers that the Big Six banks (JPMorgan Chase, Citigroup, Bank of America, Wells Fargo, Goldman Sachs, and Morgan Stanley) presently pose to the financial stability of our nation and the world, you need to understand their history in Washington, starting with the Clinton years of the 1990s. Alliances established then (not exclusively with Democrats, since bankers are bipartisan by nature) enabled these firms to become as politically powerful as they are today and to exert that power over an unprecedented amount of capital. Rest assured of one thing: their past and present CEOs will prove as critical in backing a Hillary Clinton presidency as they were in enabling her husband’s years in office.

In return, today’s titans of finance and their hordes of lobbyists, more than half of whom held prior positions in the government, exact certain requirements from Washington. They need to know that a safety net or bailout will always be available in times of emergency and that the regulatory road will be open to whatever practices they deem most profitable.

Whatever her populist pitch may be in the 2016 campaign — and she will have one — note that, in all these years, Hillary Clinton has not publicly condemned Wall Street or any individual Wall Street leader. Though she may, in the heat of that campaign, raise the bad-apples or bad-situation explanation for Wall Street’s role in the financial crisis of 2007-2008, rest assured that she will not point fingers at her friends. She will not chastise the people that pay her hundreds of thousands of dollars a pop to speak or the ones that have long shared the social circles in which she and her husband move. She is an undeniable component of the Clinton political-financial legacy that came to national fruition more than 23 years ago…”

I spent many years as a student living in one room residences and loved it. Bigger homes are nice once you have a family, for sure. But my heart remembers the simplicity and freedom of living with much less stuff. As we age, most of us come back around to scaled down housing; even if our egos may fight it. Less overhead, less upkeep, less expense, no debt and more freedom. Makes perfect sense. After 20 years of the opposite trends, ‘downsizing’ is a social evolution who’s time has come.

Small is Beautiful is a documentary following four people as they build their own tiny houses in pursuit of a mortgage free lifestyle, discovering that living tiny is about so much more than just the house. Here is the trailer direct link.

You can download the full documentary here.

On a related note, the German word for debt – Schuld – means guilt. Guilt in the sense that the accumulation of debt represents a lack of personal discipline: of spending more than one earns and of buying things before we have the money. After having been through an era of insatiable consumption where debt has been sold as a magic lifestyle enabler with no apparent embarrassment, the idea of debt being something to shun and pay off as quickly as possible, is also coming back into vogue. This is also a positive development.