The “3” are the changemakers, they rule the financial markets, they rule the world.
The past “3”:
Mission: Regulation Credit Default Swaps – shine light on “Dark Markets” of Derivatives
“There were now millions of such private contracts, involving many of Wall Street’s top firms. But there was no clearinghouse holding collateral to settle a deal gone bad, no transparent records of who was trading what.”—-…Regulation over derivatives
Time: April 1998
Player: Brooksley Born, head of Commodities Futures Trading Commission
The meeting: The President’s Working Group on Financial Markets
Federal Reserve Chairman Alan Greenspan
Treasury Secretary Robert Rubin
Securities and Exchange Commission Chairman Arthur Levitt
Resolution: The “3” said “Back off Born.”
In May 1998 Born issued a “concept release” soliciting public comment on derivatives and their risk from Congress.
Deputy Treasury Secretary Lawrence Summers decried [the release} before Congress as “casting a shadow of regulatory uncertainty over an otherwise thriving market.”–the “3” did not want Regulation over derivatives
The Current 3:
Paulson, Bernanke and Geithner sat on the derivatives problem for months before asking Congress for a bailout.
Lehman’s Fuld sat on Lehman’s problems much longer. However, do not forget Citibank and other financial institutions that have done the same.
Those months of waiting, pondering a future that was present are actually what caused the crash and current “discomfort” in national and international economics. In their waiting the current “3” refused Lehman Brothers the change they awarded Bear Stearns. They say they broke the rules for Bear Stearns because it was an over the counter trader of derivatives and CDs and Lehman Brothers was only a peripheral trader. Their theory concluded that direct derivatives trading was more infective and destructive to the market than associative or peripheral trading. Their theory proved false thereby making them implicit in government fraud, the fraud that damaged the markets. They alone caused it.
“But in an hourlong conference call with government officials, Mr. Fuld’s hope was dashed when the president of the Federal Reserve Bank of New York, Timothy F. Geithner, refused to change rules to enable quick benefit from the change Mr. Fuld had sought.”–Last days of Lehman
Because we the people voted with our dick (not I of course) the next “3” are going to include carryovers of the Dark Guard, Summers and Geithner. Good luck with that one. See
The past “3” continue to rationalize that they did not have time, but how long 10 more years? Then what
Rubin Defends His Role at Citi – WSJ.com 9:50am
Under fire for his role in the near-collapse of Citigroup, Robert Rubin said its problems were due to the buckling financial system, not its own mistakes, and that his role was peripheral even though he was one of the highest-paid officials.
[April 1998… Rubin and Greenspan tell Born to back off on shedding light on derivatives and Credit Default Swaps.]
“It’s “no time for the Fed to act like a bashful virgin,” Reinhart says, noting massive purchases of collateralized debt obligations, non-agency mortgage debt and non-investment-grade corporate bonds would not boost the federal deficit. In fact, with the Treasury’s borrowing costs a rock-bottom 1% or less, the government is likely to turn a profit on its buys.”–
Seeking Alpha “It’s Time for the Fed to Get Serious”