In 2004, at the request of the major Wall Street investment houses, including Goldman Sachs, then headed by Paulson, the U.S. Securities and Exchange Commission agreed unanimously to release the major investment houses from the net capital rule, the requirement that their brokerages hold reserve capital that limited their leverage and risk exposure. The complaint that was put forth by the investment banks was of increasingly onerous regulatory requirements -- in this case, not U.S. regulator oversight, but European Union regulation of the foreign operations of US investment groups. In the immediate lead- up to the decision, EU regulators also acceded to US pressure, and agreed not to scrutinize foreign firms' reserve holdings if the SEC agreed to do so instead. The 1999 Gramm-Leach-Bliley Act, however, put the parent holding company of each of the big American brokerages beyond SEC oversight. In order for the agreement to go ahead, the investment banks lobbied for a decision that would allow "voluntary" inspection of their parent and subsidiary holdings by the SEC.
During this repeal of the net capital rule, SEC Chairman William H. Donaldson agreed to the establishment of a risk management office that would monitor signs of future problems. This office was eventually dismantled by Chairman Christopher Cox, after discussions with Paulson. According to the New York Times, "While other financial regulatory agencies criticized a blueprint by Mr. Paulson, the [new] Treasury secretary, that proposed to reduce their stature — and that of the S.E.C. — Mr. Cox did not challenge the plan, leaving it to three former Democratic and Republican commission chairmen to complain that the blueprint would neuter the agency."[11] In late September 2008, Chairman Cox and the other Commissioners agreed to end the 2004 program of voluntary regulation. Now the fox in in the henhouse. Who runs the Banking sector? The financial aristocracy of the US plutocracy. Long live the dictatorship of finance capital, where Presidential candidates are funded by big business and are multi- millioaires in their own right. Its all good, this system of war, misery and inequality is in its death throws and is soon to be resigned to the trash can of history. On Oct 27, 2:57 am, martycarbone <[EMAIL PROTECTED]> wrote: > The following reserve requirement ratios are prescribed for all banks. > The numbers come from § 204.9 (e) of > > <<http://www.fdic.gov/regulations/laws/rules/7500-500.html#7500204.2 > > >>, a federal law. > > See:http://www.howto-ville.com/Money%20Section/moneysupply.html > > § 204.9 Reserve requirement ratios (in text form) > > The following reserve requirement ratios are prescribed for all > depository institutions, banking Edge and agreement corporations, and > United States branches and agencies of foreign banks: > > For a net "Transaction Amount" (TA), the "Reserve Requirement" (RR) is > in accordance with the following text. > > For a TA of $0 to $9.3 million, the RR is 0% of TA > For a TA of $9.3 to $43.9 million, the RR is 3% of TA > For a TA over $43.9 million, the RR is $1,038,000 + 10% of amount over > $43.9 million > > It is interesting to note that there is no mention of "capital/asset > ratio". Which, I am told by a knowledgeable authority, is what > banker's pay attention to. > > That is probably because the "capital/asset ratio" is a rule of an > international banker's group -- not a law of this country. > > This seems to raise the question, "Who is running our banking system"? > > What do you think? > > martycarbone at yahoo dot com ( correct the address) --~--~---------~--~----~------------~-------~--~----~ Thanks for being part of "PoliticalForum" at Google Groups. For options & help see http://groups.google.com/group/PoliticalForum * Visit our other community at http://www.PoliticalForum.com/ * It's active and moderated. Register and vote in our polls. * Read the latest breaking news, and more. -~----------~----~----~----~------~----~------~--~---
