Journal: Senator Chris Dodd the New Phil Gramm?

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Of, By, and For Wall Street
Of, By, and For Wall Street

Phi Beta Iota: It was Senator Phil Gramm (R-TX) that screwed the American public by inserting 200 pages of lobbyist language into a bill five minutes before passage, with no objection from any other Senator  The insertion completely deregulated the financial industry and led directly to the meltdown of the American economy.

Senator Chris Dodd (D-CT) is now the leader of banking legislation, and protecting outrageous bonuses paid by American taxpayer bail-out funds was evidently not enough for his Wall Street masters–now he has sanctioned a massive loophole as explained by  Andrew Cockburn, who together with his wife Leslie, produced the blockbuster documentary movie American Casino.

He also co-founder and editor of Counter-Punch, a gold standard in the public intelligence domain.

The Widening of a Loophole: Wall Street Snaps Its Fingers

By ANDREW COCKBURN  8 December 2009  Washington DC

Full Story Online
Full Story Online

EXTRACT:   My  veteran informant explained the dark significance of these seemingly innocuous changes:

“This language obviously creates a rather significant loophole for voice brokers, as we discussed earlier.  It is also very odd that it now says “or trading” after “execution.”  This seems to open up the same loophole that the “confirmation facility” language did, as the language now reads that an ASEF is a person or thing that “facilitates the execution” of swaps– which means a telephone, a person on the other end of a telephone, or any thing else that helps a swap get traded (as opposed to actually trades it).  In fact it is broader, since now an individual can qualify as an ASEF!  Doesn’t seem to meet the spirit of transparency and exchange-like trading that was supposedly being advanced earlier.”

Readers who might query the relevance of such arcane issues to the world at large should reflect that such trading practices are key to the gargantuan profits of the relevant banks, in particular JP Morgan, ($3 billion from derivatives in the last quarter alone) and that without them they might not survive in their present inflated form.