PBS Frontline - The Warning (on the financial crisis)

[lynnf]

PBS Frontline - The Warning

"In the devastating aftermath of the financial meltdown, FRONTLINE uncovers important clues about why it happened -- and who could have prevented it."


my take:

LTCM, a derivatives pusher, fails and the economic whizzes of the admiinistration coerce the big banks to pony up and rescue it. claims are made that the market will collapse if nothing is done.

4 bozos and a wannabe bozo stifle regulation of the derivatives market by conspiring against and castigating Brooksley Born, head of the CFTC and claiming that the market would police itself. no, not 2006 under Bush, but 1998 under the Clinton administration.


the bozos? Alan Greenspan, Larry Summers, Timothy Geithner, Robert Rubin.

(Summers and Geithner are Obama's principal economic help in the White House)

as a result, Congress removes jurisdiction for regulation from the CFTC and we all know about the economic trouble in 2008 aided by this decision. and regulation is still stalled by lobbyists now after all that.

Greenspan admitted in testimony before Congress in 2008 that he was wrong.
(worth the view just to see that at the end)

a powerful program which you can watch on the internet:

http://www.pbs.org/wgbh/pages/frontline/warning/view/


------------------------

lynn

 

[raiha]

They are having problems with their internet connectivity..Pity..I was settling down to watch it with a cup of tea after a hard day at work.

 

[emazur]

They did the same stupid shit as last time, calling people like Greenspan, Reubin, and Summers champions of the free market. If we only had more regulation, the crisis could have been averted.

But there was good info in it if you knew what to look for. For instance, just after calling Greenspan a free market advocate, they had former World Bank Prez Joseph Stiglitz say it's ironic that Greenspan would take the position of Fed chairman b/c the Fed is a megadose of market intervention.

They mentioned how CFTC head Brooksley Born had a confrontation with Greenspan where Greenspan said there shouldn't be any rules against fraud b/c "the market would take care of it". They didn't really go into detail on that, but I think most of us here think that fraud should be punished.

The program mentions how SEC Chairman Arthur Levitt was "personally lobbied" and gave into pressure to let OTC derivatives go unregulated. He now regrets it. It also mentions how 90% of Congress didn't know what a derivative was but chose to say they shouldn't be regulated. The correct lesson to learn here is that we cannot rely on government regulators. I'd like to hear an analysis of whether or not the regulation proposed by Brooksley Born would have actually made a difference in preventing the meltdown.

It mentions the Long Term Capital Mgt. bailout - how it was taken down by derivatives. The Fed arranged to have I think 14 banks bail out LTCM to prevent "systemic risk". Does anyone know if those banks were forced to participate in this bailout?

 

[revolutionary8]

They did the same stupid shit as last time, calling people like Greenspan, Reubin, and Summers champions of the free market. If we only had more regulation, the crisis could have been averted.

But there was good info in it if you knew what to look for. For instance, just after calling Greenspan a free market advocate, they had former World Bank Prez Joseph Stiglitz say it's ironic that Greenspan would take the position of Fed chairman b/c the Fed is a megadose of market intervention.

They mentioned how CFTC head Brooksley Born had a confrontation with Greenspan where Greenspan said there shouldn't be any rules against fraud b/c "the market would take care of it". They didn't really go into detail on that, but I think most of us here think that fraud should be punished.

The program mentions how SEC Chairman Arthur Levitt was "personally lobbied" and gave into pressure to let OTC derivatives go unregulated. He now regrets it. It also mentions how 90% of Congress didn't know what a derivative was but chose to say they shouldn't be regulated. The correct lesson to learn here is that we cannot rely on government regulators. I'd like to hear an analysis of whether or not the regulation proposed by Brooksley Born would have actually made a difference in preventing the meltdown.

Yep. I turned it off after about 15 min, I wanted to bang my head against a concrete wall. Where is the part about Greenspan before the Fed ate his soul?
For chrissakes, he was a gold bug before he turned himself over to the darkside...

 

[frasu]

... I'd like to hear an analysis of whether or not the regulation proposed by Brooksley Born would have actually made a difference in preventing the meltdown.

That was my dilemma watching "The Warning"... Great inside on how Washington and the bankers cover each others fraudulent activities.

 

[lester1/2jr]

just make sure you read tom woods "meltdown" before you watch the soap opera / state tv version of "what really happened". I doubt you'll hear the words "artificially low interest rates" in this thing

 

[Working Poor]

I was disappointed in this show. They made it sound like "free market" is a bad word and Ayn Rand didn't know shit...

 

[richardfortherepublic]

I watched this late last night, and it didn't take long for me to see that they were trying really hard to make Greenspan and Summers look like libertarians 'fighting from the inside'.

Which is complete malarky.

Otherwise, a lot of good info. Good documentary to watch at 2 am.