Go, Economy!

The idea that they are doing this to cover overheard on CD's is just nonsense.

You are basically saying that companies like JP Morgan can either choose a small return or take massive risks that put giant chunks of their profitability and even solvency at risk. That's all there is. Obviously this is not true. For someone who claims to have a degree in actuarial science, your idea of risk is childish. Please tell me you are trolling.

Whether or not is the government's role to mitigate this behavior as necessary, I think many economists going back to Adam Smith would say that it is.

I'm using the CDs as a really simple example. And an investment portfolio is not made up of binary choices at each end of the spectrum, but you know this.

My question is, with all the knee jerk bullshit that was passed after 2008, how could this happen if it's so awful? Where was big brother to protect us?

Yeah, Yoshi's argument is kind of retarded.

Its like he has forgotten that the bulk of banking has been automated. Taking your money from your employer and putting it in your checking or savings cost them less than a fraction of a cent. And they make money when you buy things because the retailer pays them a fee to take payment with the card.

Then you ad in the interest payments they get from making loans on simple things like people wanting to buy houses, local businesses buying new equipment, etc, they shouldn't need to take these risks.

They pull in income from all over the place without doing hardly anything.

What knee-jerk bullshit? The only thing of relevance was Dodd-Frank, which was certainly debated for a long time before it was passed (it was no Patriot Act). Many people said at the time was grossly inadequate. And even worse it left most of the details to agencies, where it is currently getting lobbied into irrelevance.

The sucky thing is that we had good law and good regulation on the books from the 1930's through about the late 1990's.

cheeks, You're going with interest rates that are incredibly low and credit card fees as viable revenue streams long term?

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Originally Posted by Diff-chan

What knee-jerk bullshit? The only thing of relevance was Dodd-Frank, which was certainly debated for a long time before it was passed (it was no Patriot Act). Many people said at the time was grossly inadequate. And even worse it left most of the details to agencies, where it is currently getting lobbied into irrelevance.

The sucky thing is that we had good law and good regulation on the books from the 1930's through about the late 1990's.

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The ineffectiveness of Dodd-Frank is part of my point. The Feds cannot get this right. I cannot imagine anyone really arguing that. And half assed government intervention is worse than the government just getting the fuck out of the way, because it burns through federal resources that would be better used somewhere else, if at all, and allows the targets to just do basically what they would have done without it.

Yoshi, you realize that the banks take money from the Fed at near zero interest rates and loan it back to the government and it's customers at 4+%?

Making money as a bank is literally the easiest thing in the world to do.

Also, the Volcker rule would have kept JP Morgan from losing this 6-7 billion. As would have Glass Steagal

You're only looking at half the equation though. How much would those rules have kept them from making on the other side?

Plus, once again I'll remind you that from January, 2009 through 2010, the only people keeping the Democrats from saving Chicken Little from the falling sky were the Democrats.

Who cares? They made a fuckload selling residential mortgage backed securities in 2007 too.

And their investors are more concerned with mortgages today than this loss.