05 November 2012

Welfare for Wealthy Speculators or What's Wrong with the Putative "Reform" of the Finance Sector?

"Many Americans probably think the Dodd-Frank financial reform law will protect taxpayers from future bailouts. Wrong. In fact, Dodd-Frank actually widened the federal safety net for big institutions. Under that law, eight more giants were granted the right to tap the Federal Reserve for funding when the next crisis hits. At the same time, those eight may avoid Dodd-Frank measures that govern how we’re supposed to wind down institutions that get into trouble.

In other words, these lucky eight got the best of both worlds: access to the Fed’s money and no penalty for failure."
This is the punchline from a very useful article in The New York Times yesterday. This is why we need groups like Occupy the SEC.

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