But Wait, Obama's New Bank Plan Won't Fix A Thing
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We agree with President Obama that it is ludicrous that, a year after a financial crisis almost destroyed the US economy, regulators haven't changed a thing.
Tim Geithner's "Too Big To Fail" policy is firmly in place, and our financial institutions can do whatever they want again.
So we were relieved to hear that Obama is finally deciding to do something about this.
But here's the problem: His new proposal won't fix a thing.
Under Obama's proposal, "banks" will no longer be able to trade for their own accounts or own, sponsor, or invest in hedge funds. So if you want to trade for your own account or own, sponsor, or invest in hedge funds, then... just don't be a bank!
In the fall of 2008, Lehman Brothers wasn't a bank. Neither was Bear Stearns. Or Goldman, Morgan, or Merrill Lynch. Or Fannie or Freddie. Or AIG--remember AIG?
None of these firms were banks.
