We’ve been trying to put a regulatory framework on these banks and institutions for quite a few years now, and one of the first that started driving banks into these complex derivatives and whatnot were the Basil requirements instituted in 1988.

Then, Basil II, SOX, etc only accentuated the move towards financial instruments that were extremely risky but “off-balance-sheet” so they wouldn’t have to leave reserve requirements for them. The problem with expecting them to not to this though, is rather stupid, as banks go uncompetitive if they just let their money sit around without gaining more returns than other banks who are competing with them (and will outcompete/buy them out if stronger).

I’d argue that those regulations—PLUS the current deregulation, which loosed the last floodgates on all-out pursuit of these instruments that previous regulation forced upon banks triggered in the first place—is what caused the crisis.

Basically, in essence, we made traditional, safe investments extremely unattractive and somehow expected banks to not spin off into risky investments that, even with the risk, are now more profitable.

I also have a more complete write-up of all of these ideas here:
http://depolitik.com/2008/10/04/why-lawmakers-and-experts-are-wrong-about-the-financial-crisis/

The DNC and biased media “selected” Barack Hussein Obama — he was not “elected” by the people. During the primaries, he hired lawyers to stop the votes in Florida and Michigan. What’s his next typical ‘Chicago-Mobster’ step?

For the past 2 years, the Democratic leadership, including NANCY PELOSI, HARRY REID, AND BARACK OBAMA, has pulled all sorts of strings to make the American people believe that the economy was collapsing.

THEY HAVE NOT PASSED UP ANY OPPORTUNITY TO “HURT” THE ECONOMY IN ORDER TO MAKE THEIR POINT.

Refusing to take common sense steps to keep oil and gasoline prices low is just one thing the Democratically-controlled Congress has done to hurt the economy.

We are now sending several billion dollars each and every day overseas. Our money is employing foreign workers to drill, pump, refine, and transport oil, instead of employing American workers to do those same jobs.

Who in their right mind would question the impact this currency drain is having? Higher gas prices make it more difficult to meet one’s home mortgage payments. And defaulting on Mortgages in part has brought on the current crisis.

Fannie Mae and Freddie Mac lobbyists contributed mightily to the Dems. Obama was the #2 recipient of these contributions! The CEO’s and top officers walked away with millions.

So should some of the fault of our current Wall Street Crisis be laid at the feet of PELOSI, REID, OBAMA, and their other liberal Democratic friends?

WITHOUT A DOUBT IT SHOULD!

WE NEED TO REPLACE ALL DO-NOTHING DEMS IN CONGRESS!

I’M VOTING FOR JOHN McCAIN IN NOVEMBER!