On a somewhat related note, the one good item out of Mr. Scott's election is it appears to have scared President Obama. Larry Summers was ordered to take the gag out of Paul Volcker's mouth, remove him from the closet he has stuffed him into and actually listen to him. (I believe hell just froze over) Some talk this morning of somehow separating commercial banking from investment banking, or at least limiting some activities... apparently the people's anger actually matters a bit after all. There is nothing like self preservation to get politicians to act in the interest of the people....
- President Barack Obama is expected later Thursday to propose new limits on the size of 'too-big-to-fail' banks and the risks they may take. The proposal aims to deter commercial banks from becoming so large that they put the broader economy at risk, and also to prevent them from growing large enough to distort normal competitive forces, according to the Wall Street Journal, which cited congressional sources and administration officials.
- The president is also expected to endorse some recommendations by former Federal Reserve chairman Paul Volcker, placing restrictions on commercial banks so as to prevent them from using federally insured deposits to finance speculative or risky investment banking activity, including proprietary trading of their own accounts such as mortgage-backed securities considered central to the crisis that shook the economy to the brink in 2008. (this one actually might hold some promise)
And as I type that, the S&P 500 is now down below 1130. It looks like Goldman Sachs is throwing a temper tantrum as they move the market down in response to Volcker making progress. (allegedly of course) ;)