Financial "reform"

My favorite quote from Thomas Jefferson goes something like this: If a man is not fit to rule himself, how then can he be fit to rule others?

The b.s. coming out of the dem-dominated congress is astounding. They established this farcical "blame" for the financial crisis as "banks behaving badly," then propose a huge government-run bureaucracy to fix that behavior.

First of all, it was largely CRA legislation -- congress's requirement that banks make bad mortgage loans. During the Bush Administration, with the Dot-Com Bubble collapsing followed by 9/11, the economy began to tank. So the Fed (the bank authority, that is) set prime rates close to zero to "stimulate" the economy.

Net Result: Pumping lots of hot air into the housing market. Then shunting all those bad loans into Fannie Mae and Freddie Mac funds -- federally guaranteed. Thus, all that very bad paper got "redistributed" into financial markets all over the world.

All the mortgage foreclosures, falling property values, and all of that is the market correcting itself. It will continue to do this -- on its own -- no matter what the government or individual financial institutions try to do about it. This whole government-created disaster is what can be called a "rolling readjustment" of hype and over-bidded value of real estate.

The government pretends it has something to do with hedge funds. And maybe it does. Mostly what I know about hedge funds is that George Soros (radical communist financial backer) is the master of them, and that they only make money in a down market, or on falling stocks. I do understand how a hedge works, but it's too damn hard to explain here. (Look it up.)

At any rate, it looks like some kind of perfect storm. The housing and financial (read mortgage) markets were shoved to the edge of a precipice through legislation and excessive regulation, and someone -- maybe Soros, he's done it before; he's destroyed the economies of two nations that I know of, and maybe more -- pushed the market over the edge. Soros, after all, makes money on hedge funds, which work only in a down or collapsing market.

So who benefitted from this?

At any rate, what I can gather about proposed financial "reform" legislation is that is puts tighter governmental controls over banks and other financial institutions. The good news is that officers from banks and other institutions get to sit on the regulatory board. The bad news is that the federal government has almost autocratic authority over the board's decisions, and can even circumvent the board if it feels the need.

I guarantee, the Comrade and the merry marxists will "feel the need."

Additionally, the proposed regulations don't touch Fannie and Freddie, which were the primary sources of all the problems to begin with.

So it looks kinda like this bill is yet another attempt of the socialists in the White House and the congressional majority to seize control of institutions that right now are already w-a-a-a-y over-regulated. The bumbling and short-sighted regulations were the cause of the problem to begin with.

These self-proclaimed financial experts in the federal government keep claiming that the 2008's financial disaster was caused by "irresponsible" and "reckless" activities perpetrated by private financial institutions. George Bush gave them free rein to run rampant on Wall Street. Bull shit, you know? Although we should credit the Fed with a strong assist.

So the government caused the initial problem and is now working very hard to tighten its control over financial institutions, which know their industry much better than the blockheads in the federal government.

What's wrong with this picture? Sorta like the lunatics running the asylum?

'Course the icing on the cake is the feds now proclaim that their bail-out pet, Goldman Sachs, has been indulging in bad behavior. "See," they say, "you can't trust anyone on Wall Street." I never trusted Goldman Sachs. It was Geithner and the feds who trusted them, wasn't it?

But you know what? I trust Wall Street a lot more than I trust Washington. Wall Street only wants to make money. Nothing wrong with that. A genuinly free market is self-regulating -- they screw up, they go bankrupt. They screw customers, they go bankrupt. They over-extend, they go bankrupt. And good riddance. Let them fail. Failure clears out the deadwood and makes room for newer, better companies.

On the other hand, Washington wants power and control -- and in order to get it, they have to take it away from us. And based on recent history, they don't know what the hell they're doing in regard to the financial industry.

So remember: If a man is not fit to rule himself, how then can he be fit to rule others?

Save the republic.