Friday Movie Night - Risky Business

hot buttered popcorn It's Friday Night! Party Time!   Time to relax, put your feet up on the couch, lay back, and watch some detailed videos on economic policy!


Tonight's Friday Movie Night is a little different and why it's being posted early. Senator Bryon Dorgan has come alive and getting involved in financial reform. This is great news for Dorgan predicted derivatives were a very serious problem 15 years ago (take that Taleb & Roubini!). First, below is Dorgan's call to action. Next is a talk on derivatives and financial reform by Dorgan. Finally is Senator Bernie Sander''s Too Big to Exist bill which breaks up the systemically risky institutions.

Considering we have financial lobbyists writing the House derivatives bill (exceptional piece by William Greider) and a complex maze of financial reform (where we are still digging through to find the loopholes exemptions), we call your attention to a refreshing breeze blowing down from common sense North Dakota.

Senator Bryon Dorgan is requesting you get involved in demanding common sense financial regulatory reform and reinstate Glass-Steagall (separate out FDIC insured banks from investment banks).

Too Big to Fail Bill

The House Financial Services Committee, along with the Treasury Department has proposed a new too big to fail piece of legislation.

The bill is titled The Financial Stability Improvement Act of 2009 and the bill text is here.

The bill creates an inter-agency regulatory agency called the Financial Services Oversight Council.

The bill appears to be once again, making the Federal Reserve super regulator but with wording to hide this fact.

Removes the Gramm-Leach-Bliley Act’s restraints on the Fed’s authority over companies subject to consolidated regulation and provides specific authority to the Fed and other federal financial agencies to regulate for financial stability purposes and quickly address potential problems.

The bill also seems to be not reinstating Glass-Steagall, instead putting some watered down restrictions, but only going forward. Seemingly existing institutions will not be broken up.