For the banks, or for the rest of the economy?
Judging by what Tibetan Fox posted, the latter.
Considering the persistent high unemployment, lower wages, and all that, I'd disagree.
"Oh Jegus you have no idea. The nastier aspects of the New Deal (in particular, the National Recovery Administration) have been largely forgotten." - Tibetan Fox
I'm not even very familiar with the New Deal and I'm inclined to think it should be no surprise that it has some pretty nasty aspects. Despite FDR's reputation as a great president, the guy DID do some pretty terrible things. (Executive order 9066 for one thing.)
That was for WWII, not the New Deal.
Indeed it was.
I'm not trying to say things aren't bad, Ivy. I'm saying that if we hadn't built on knowledge gained from experiences in the last couple of banking panics, it would be even worse.
Some bad things are an unavoidable side effect of good things. One of the reasons we keep having these periodic recessions and banking panics, even though we could indeed do away from them is we'd lose a lot of good stuff as well. A whole lot of businesses would lose the lines of credit they need to maintain a viable cash flow.
If you want to talk about unemployment and downward wage spirals, there's a path of real nastiness. For all the bastardry bankers engage in, a lot of us are dependent upon them, even if we don't quite understand to what extent.
Tibetan Fox:
Do you think part of the reason we went for 50 years without a major banking crash might have been because business and banking were so highly regulated before all the deregulation that began in the 80s?
Such as the non-FDIC-insured S&Ls that numerous scumballs used to steal people's money in the '80s.
Here's an idea: require all businesses over a certain size to make all the files on their computers publicly readable by anyone with an Internet connection the nanosecond the files are created or modified.
If you're too big for one person to manage, you're too big to have secrets.
edited 20th Feb '11 7:08:02 AM by Roxor
Accidental mistakes are forgivable, intentional ones are not.An extension on that: you know citizen's arrests? Allow them in cases of white-collar crime. In fact, allow the SEC to open cases to the public and allow anyone to gather prosecuting evidence. Encourage participation with old-fashioned bounty postings.
I'd like to see Wall Street's reaction when Anonymous goes after them.
edited 20th Feb '11 4:41:23 PM by RadicalTaoist
Share it so that people can get into this conversation, 'cause we're not the only ones who think like this.@jeweleddragon. Kind of a complex question to answer, but that would have been a factor. Regulation does not come without cost, however. In particular, it tends to create operating costs and barriers to entry that unfairly privilege big incumbents. Solving every problem by throwing more regulation at it is a great way to create oligopolies and "Too big to fail" situations.
@Eric DVH. Yes, the Savings & Loan crisis was the last time the banking situation went to shit. In that case, ironically, it was due largely to a lot of small banks being run by people who didn't really know jack about banking.
@Roxor. I really hope you weren't being serious.
@Radical Taoist. Likewise. Mob justice is hardly going to do anything constructive.
On the contrary, it will make the cost of legally defending yourself with an Army of Lawyers much more difficult for executives who break the rules. Good for the lawyers, admittedly, but also easier for the Justice Department.
Share it so that people can get into this conversation, 'cause we're not the only ones who think like this.Fuck it. The regulations need to be in place, and their absence certainly isn't preventing monopolies from forming.
Startups can't afford an Army of Lawyers. Bye bye startups!
Do startups pull enormous scams like those described earlier in the thread?
Share it so that people can get into this conversation, 'cause we're not the only ones who think like this.You know what would be fun? Making it illegal to pay lawyers.
Fight smart, not fair.You know what would be fun? Making it illegal to pay lawyers.
Fight smart, not fair.I'm reminded of an old Mad Magazine spoof of Back To The Future.
Marty: Wait, how did they resolve a murder trial in 20 minutes?
Doc: They've changed the legal system in the future - got rid of all the lawyers.
Marty: How do things work without any lawyers?
Doc: A lot better!
edited 20th Feb '11 7:41:54 PM by RadicalTaoist
Share it so that people can get into this conversation, 'cause we're not the only ones who think like this.@Tibetan Fox: No, I wasn't joking. I also think the "no secrets" policy should be applied to governments.
@Radical Taoist: Excellent point about startups not pulling massive scams like big businesses do.
@Deboss: About the only way I can think of which could make that possible would be to nationalise the practice of law. Anyone other than the government department employing them who tries to pay them could be fined for attempting to bribe a government official.
Accidental mistakes are forgivable, intentional ones are not.Yeah, I think I'm done here.
...damn, I had some questions. Seems like an interesting discussion.
I agree with this, and it's completely valid. But you've ignored the more obvious solution to this problem: don't limit intervention to emergencies. If they had regular laws against certain dangerous business practices (and it's not like a lot of these cases aren't the same kinds of fraud over and over again, although there will always be new and exciting ways to commit fraud), laws that were actually enforced in a fairly consistent manner, there would be no uncertainty. Businesses would know what to expect: that the laws would be enforced, rather than the laws not being enforced as is status quo now. Sure this would require an initial period of change, but so would any change. And I don't think anyone can argue for "no change, ever", not in any realistic sense.
Someone has to do it eventually. Jenga towers eventually run out of blocks to pull, though they usually collapse well before that point.
Ok, that was torturing the metaphor a bit. Basically put, financial regulation will change over time, and I don't see any particular reason to choose later over now. Yes, in the short term, such changes might damage the economy. It's a question of long term planning vs. short term gain, I think.
And the worst part is, they almost always rise to the top of the corporate ladder because their tactics bring in lots of profits...for a time.
Do all regulations necessarily do this, however? Is this necessarily a bad thing, if the regulations are properly enforced? Maybe banks are an institution it makes more sense to have in larger, centralized but highly regulated units; much like power companies they provide an essential service with a large amount of infrastructure behind it, that almost need to be of a certain size to be of use/profitable.
That's a bit deceptive, we're only talking about regulating banks. Which means you're only talking about less startup banks, not start-ups in general.
And honestly, how many start-up banks are there, and how many of those don't get bought up fairly quickly by other banks?
Look, you can't make me speak in a logical, coherent, intelligent bananna.It mean it can't be stopped even if it should be, unlike this thread, which can be locked due to being necroed from ages past.
“And the Bunny nails it!” ~ Gabrael “If the UN can get through a day without everyone strangling everyone else so can we.” ~ Cyran
Yup. The good news is it gets less bad every time.