Putting your money in trust

No surprise then that President Obama is pushing ahead with his Bank Reform Bill which calls for tougher regulation, the setting up of an ‘oversight’ committee and various other restrictions in an attempt to remove the risk of any future economic collapse as experienced over the past few years.
He needs Republican support who generally view the bill as largely bureaucratic, but analysts suggest that even their view on passing the bill is softening. So, the President is gaining some traction over this and as he addresses the Cooper Union College in New York today we can perhaps expect a lecture but also a plea for Wall Street not to fight the reforms “for the good of all”.
Now bankers are not known generally for being supportive of regulation, after all it cramps their style but even the most vociferous opponent must understand Mr. Obama’s assertion that it would be folly to do nothing and not learn from the mistakes which saw the end to a number of long standing financial institutions and the required bail outs of unimaginable scale.
Of course the bankers are trying to convince one and all that self regulation is the way to go and the obvious response to that would be why they should be trusted now. “Trust us” they say but some of those bonuses can be quite an incentive to push the rules to their limit.
This brings into question the issue of banker’s bonuses and the bank’s view that you need the incentive to get and retain the best people. But you can’t have it both ways. Big bonuses and the same level of regulation wreaked havoc the first time and frankly what signs of reformation exist so far? The current Goldman Sachs allegations are a case in point.
The bill has a long way to go yet to become law and the Republicans are in a tough spot as do they want to be viewed by the voting public as the party that supported their friends in Wall Street ahead of protecting the man in the street from all the impacts resulting from this latest recession?
Here at Zeitgeist we like the definition of an idiot as “someone who does the same thing over and over expecting a different outcome….” Whilst we would not wish to label the Bank powerbrokers as idiot’s we feel they might just find it within themselves to accept Joe Public’s skepticism that they are capable of changing their behaviors and implementing appropriate self regulation.
On that basis then, some additional regulation by whatever form it takes, is surely an inevitability.