Tag Archives: Wall Street

Money and Hillary Clinton

money and Hillary Clinton

I actually know very little about Hillary Clinton and money, and neither, apparently does anyone else, although there is plenty of theory and conspiratorial conjecturing going on out there among those who are either very informed or very paranoid. I don’t know what Hillary intended in Libya, or in Africa, or in Honduras. There are many who call her the new Dick Cheney or the new Henry Kissinger and imply that she is a Machiavellian figure, or perhaps one of the Borgias.

To folks in these particular journalistic circles she represents the very worst in American politics which has a secretive dark agenda and sends out our government officials to meddle in the business of nations around the world, build nations up and tear nations down, all for cynical reasons having to do with economics and money. Or perhaps Hillary has no mission to inform her actions but is simply acting on her own. According to these folks Hillary is a sinister figure who ruins nations when their economies are getting too successful and are challenging the America economy. Wow! Who knew Hillary was this powerful and this corrupt? Apparently everyone but me.

Bernie Sanders indicts Hillary for using government service to get rich. He tells his supporters anecdotes which supposedly prove that she has offered influence in return for donations from wealthy nations. Sanders apparently implies that the Clinton Foundation is a front to peddle influence and line the Clinton’s pockets. He believes that accepting money from Wall Street proves that you are absolutely corrupt. His followers believe all this is true beyond a shadow of a doubt and they revile Hillary for this. Again, I did not ascribe to Hillary even this level of villainy. They say that Hillary is a criminal who should be indicted for war crimes, or crimes against humanity, or bribery, or if nothing else sticks, then for the private email server thing (possibly risking national security).

How naïve am I? I see that half of Congress is made up of millionaires, many of whom lined their bank accounts while in government service. I know that Bernie Sanders is solidly against money in politics, feeling that it robs the people of their right to govern. I agree with him. I was shocked when Citizen’s United was upheld by the Supreme Court, giving legitimacy to all the money that floods in and befuddles politics in Washington. But Hillary came up as a politician operating within the system we have now. Bernie is a revolutionary who wants to dump the system we have now. We could possible get money out of politics through a grassroots groundswell, but it is more likely that it will be tough slog, accomplished in baby steps.

Hillary, as the first woman to get this close to being an American President, has a foot in the past and a foot in the future. She cannot be blamed for playing the game according to the rules of the boys club. We are always changing the rules just when a woman arrives at a threshold. Bernie’s purity did not help him shine in Congress although it certainly looks appealing now. But there is no other person in our government like Bernie Sanders and changing the way our government does business cannot be as easy as he makes it sound. If Donald Trump is dividing the nation before he gains the office, then Bernie Sanders is likely to divide it if he becomes our President. People who have been on the gravy train for years are not going to gently step aside. If we the people win the day it might be worth the fight, but we could probably win the day eventually with just good solid strategy if we had a plan.

I believe that people are painting Hillary as a villain based on some pretty convoluted reasoning and theorizing. Of course, if anyone can prove these accusations beyond any doubt then I suppose that Hillary is too byzantine to make a good President. If she actually treats the globe like some kind of calculated game of Risk then that is diabolical and she should be stopped. I just don’t buy it though.

By Nancy Brisson

Regulating Wall Street

wallstreet

Can we afford to mess with Wall Street? Isn’t it like the tick tock heartbeat that keeps our Capitalist economies alive? I picture an endless cycle of regulatory action and Wall Street vengeance. The whole idea of an index of economic health that is built around putting down a bet on whether a company or commodity will turn a profit strikes me as a ridiculously unstable structure on which to base an economy or my retirement income. However that is the system we have.

As the Industrial Age moves on to distant corners (from us) of the globe the Stock Market has experienced ever more volatility and is less and less under our control. American companies do not have factories in America, they don’t pay taxes in America, but they still hold places on the American Stock Exchange (and other Stock Exchanges). And, although for many years our Stock Market pretty much set the pace around the world that is no longer as true. There are Stock Markets in a number of countries that can send shock waves through ours.

The “creative” way that the stock brokerage companies in America met the changes in the industrial scene in America should have been and probably were illegal. However, even if they were not sure about whether or not what they were doing was illegal they knew it was risky. Perhaps it was not illegal because no one ever actually thought of doing something as stupid as bundling up bad mortgages with good mortgages and rating the whole bundle according to the best mortgages in the bundle. What is clear is that someone at these stock brokerages knew that these bundles reeked and that there might/would be financial repercussions. This does not even touch the illegality of the banks and mortgage companies that offered these mortgages in the first place.

Our economy obviously can’t take too much of this kind of “black hat” creativity. We watched in horror as banks foreclosed on house after house forcing Americans to scramble for new living arrangements and sometimes creating whole neighborhoods of empty houses. The Stock Market took a nose dive. My pension (and those of many other Americans) took a nose dive. Employment took that same dive. Without the TARP I don’t think we would have pulled up before we hit rock bottom. Without the stimulus we may have already had the revolution we could still be headed for.

It stands to reason that the argument that we might have to regulate Wall Street, make some rules about what it is legal to do and what it is not legal to do has gained lots of traction. This is what many Americans like about Elizabeth Warren and Bernie Sanders. We are justifiably angry at greedy hedge fund operators and mortgage companies for almost destroying the American economy and we don’t just want reform, we want punishment. Hillary Clinton has also said that some regulation is necessary although she does not hook into people’s anger and does not seem to want to tar and feather the perpetrators and run them out of the finance business. Mostly we would be happy if they had to give us back what we lost as a result of their adventures in edgy economics.

But as for the future, for me, and perhaps for you, there are questions. First of all, since no one could have foreseen the bundling and sale of those stinky mortgages (hold your nose) can we ever foresee every new ploy these people, who must make money or die, can create? Second, can the American Stock Market provide the secure investment structure and the secure economic base America needs any more at all? How would America function without a Stock Market? Perhaps some economists could discuss this among themselves and allow us to listen in.

Can we overregulate the Stock Market and crash it? How do we choose the exact regulations that will protect us from illegal profiteering and yet will allow the Stock Market enough room to keep ticking along? If the SEC is unable to oversee the market can we whip it into shape without putting a straitjacket on the market?

Although I hate what brokerage firms did to us to attempt to make money from bad mortgages, I go back to my very first question – can we afford to mess with Wall Street? And if so, how much? I think we are afraid, we are very afraid, because we are not sure about the fragility of our economy and the entire global economy. I have a gut feeling that we should buck up the economy before we decide about large scale regulation of the Stock Market or even perhaps the “Big Banks” despite our very real anger and our desire to send a tough message through punishment. I also have a gut feeling that effective oversight is important to stop truly risky financial strategies that could still be invented by both the Stock Market and the banks. Everyone needs to keep an eye on our pressure cooker financial crucible that is the Stock Market and the banks.

So I am feeling that I need more information about exactly what regulation would look like and what the effects of any regulation or various regulatory measures might be. This is a time when we need to look to our economists. We also need to remember that economics is hardly an exact science and that economists have differing points of view on these matters which may be influenced by famous economists, or by their politics, or both. What we decide, even after input from the field, will still require a final judgment on the part of each of us. Please you economics geeks, use simple language that we can all understand and perhaps some scenarios like the ones they used in the film The Big Short to illustrate your points.

By Nancy Brisson

(Disclaimer: you may or may not believe this but I wrote this on Saturday, February 6th 2016. When I listened to Meet the Press on Sunday and to the discussion of these matters between Hillary Clinton and Chuck Todd it was just serendipity that I had just written this post. The only change I made to this post after hearing their conversation was to add this note.)