“In the aftermath of the 2008 financial crisis, the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (Dodd-Frank Act) enhanced the CFTC’s regulatory authority to oversee the more than $400 trillion swaps market.” -CFTC
It sure sounds good. Sure sounds like they care, right?
Here’s a definition of the word ‘Sham’ so that you can reference this whole idea as these words evolve little thought bubbles in that head of yours, dearest reader;
So what does Dodd Frank do?
Added some rules and regulations on swaps and who can assign them, making it so there’s more robust tape behind becoming a dealer or broker. Which really just makes it more of a big-boys club with big money, meaning that the markets now require players to be able to pay up or pony up a lot more. And by players, I don’t mean poor retail shmucks.
I mean players like brokers and dealers, you know, the real players that are playing the market. Shmucks like the average mom and pop are just getting played, they’re not the players.
So margin and capital requirements were imposed. Things like standard swap contracts were publicized, and I’ll give them credit, things like public Standard contracts such as calls and puts not being hidden in off-exchanges could prevent dumb shit like the Nickel Fiasco on the LME. Lmao.
Besides what was mentioned above, All this Act really did was make more steps to include more parties to eventually be corrupted. Things like ‘clearing houses’ now being a bigger role in adding layers to this cake, or adding more bag holders to hold a bag of bad holders. In this sense, clearing houses are sort of bags of holding, lmao.
Yea, this act helped to make Clearinghouses act as middlemen between two parties to a transaction and take on the risk that one counterparty may default on its obligations. But that only works if the Clearinghouse actually does it’s job, and with the way the industry is, they don’t plan to do their job. And the DTCC seems to not plan to enforce their members (the clearinghouses) to do their job.
Asking a Clearinghouse to pay up if one side of the trade falls through, is like asking an insurance company to give money on a valid insurance claim. As an obvious for profit business, neither of these companies want to pay up. So for the maximization of profits, it’s best for both Insurance and Clearinghouses to not pay up. Clearing houses are essentially insurance on trades. They just collect a little tax for each transaction to ‘guarantee’ the trade but at the same time they don’t ever want to actually pony up.
So really, this Act is just Gambling Degeneracy at the stock market with extra steps.
A lot of people believe that the Dodd frank makes it so under no circumstance can the government bail out degenerate ‘players’. Apparently, per the act, these players have to liquidate. But uh, the government eventually ends up bailing out these degenerates still.
There’s actually a loophole,
If an institution becomes insolvent, they would have to liquidate assets to cover the losses as well as sell off debt to other institutions. If they sold all their shit but still owe money, because they’re gambling with billions of leveraged funds, then they still owe a fuck ton of money. That means someone has to pay that bill.
“In addition to these requirements, the law also provides for an expedient liquidation process for any insolvent financial institution, including the regulatory tools to implement the liquidation. This process referred to as “Statutory Bail-Ins” includes expanded powers to the Federal Reserve, the Securities and Exchange Commission (SEC) and the Federal Deposit Insurance Corporation (FDIC), whereby bank holding companies and significant non-bank holding companies can be placed in receivership under federal control with the FDIC acting as receiver under Title II of the Act.3″
Queue the FDIC;
” Well this is when the FDIC steps in. They come to save the day and give you up to 250k back. The problem is the institutional derivative value is so large the FDIC doesn’t have enough money to cover it. JPM, for example, has more value in derivatives than global GDP. I don’t know how that isn’t seen as systemic risk but that’s another conversation. Well it turns out the FDIC “is backed by the full faith and credit of the United States government.”
Wait, wait, wait a minute…
So if they become insolvent the gov wont bail them out, they have to liquidate. Then the FDIC comes and pays off the extra debt but if they can’t cover it the United States Government steps in and bails them out. Well look at that! Once again, the taxpayers are left footing the bill for the extreme risk the institutions have taken because they don’t stand to lose. Did we learn anything in 2008?”
-Some Person on the internet
You know, the US Government that we have full faith in everything it has done, from rigging foreign elections, bombing school busses and schools, bombing water supplies, initiating coups, unjustly invading people’s homes, and printing ass whacks of money in the tune of trillions times over and over again. Yea, that same government that’s supposed to back up the small guys.
So the FDIC comes in to bail out the banks. The government bails out the banks still. Dodd Frank just adds more steps.
But it get’s worse because;
There’s “bail-ins” now
So before, we had investment bank gambling retards separate from commercial bank safe investments. And now that the two are superfluously mixed. And that thing called the FDIC that was supposed to insure people’s money in banks up to a certain amount of about 250k?
Yea, turns out that instead of the government backing you up. You back the government up. So if the bank fails, you’ll have a thing called a bail-in, meaning your money can be seized to pay for the debt of your institution. So you don’t have insurance. You’re now insuring the government.
“If you happen to hold your money in a savings or checking account at a bank, and that bank collapses, it [FDIC] can legally freeze and confiscate your funds for purposes of maintaining its solvency. This is known as a “bail-in.” Meaning that instead of relying on government funds (taxpayer money) to save itself from going bankrupt, a bank can simply dip into your deposit accounts to stabilize itself. In other words, bail-ins will not add to the government’s deficit. . .
A perfect scenario, where neither the government nor the too big to fail institutions bear any risk. It all falls on YOU “the depositor.” Is this ethical? No. Legal? Yes.”
Hey, and if you don’t have enough money to bail out these banks that are too big to fail. Then the government will, via the FDIC, bail out the degenerate gamblers.
So literally, they just made regular people foot the bill and then the government, which the government pays with taxes footed by regular people.
So the FDIC is a scam.
And if they ever get around to paying up, you’ll probably be paid last. Let’s be real, the Derivatives market is in the trillions or even the quadrillions. The FDIC has something in the billions. If you do the math or the risk assessment or even the analysis of cost or risk. You’ll realize that this shit doesn’t add up.
Chances are, the FDIC won’t pay you shit, you’ll go to claims, and the US Gov will probably print more money for large corporations to stay afloat and give you 1,200 for your troubles and financial devastation as you accrue a generation traumatic amount of debt.
This is the likely scenario;
Dodd frank is just a dog and pony show. The Congressional hearings was just a circus to fool the masses, and one guy got locked up as the fall guy. All of this just added extra steps and a small bandaid patch to the mess of a monstrosity known as the Financial System.
You know, instead of unmarrying the gambling (of investment banking) from things like Teacher’s pension funds or life savings or regular savings.
Yea, can’t have any of that Glass Steagall in here. Nope.
It’s great though, because the government can just print money like it has in the last few years, and just give it to banks, prime brokers, random failing businesses like airlines, and such. So, I guess bail outs are still on the menu. No guarantee that you’ll get them. You’re like the least of their concerns.
You know when the FDIC was made?
After the Great Depression.
You know when Glass Steagall was made?
After the Great Depression.
What did they both do?
Separate Investment banking and Commercial banking. Glass Steagall separated the investments. FDIC insured only the safe commercial banking investments. Hence, making them safe investments. . . Because the literal government insured them.
What happened to Glass Steagall?
It Got Repealed in 1999 and is no longer valid, so Investment Banking and Commercial Banking can gamble with eachothers’ funds. This resulted in all types of banks fucking flipping things like Mortgage Backed Securities, because owning a home is no longer a safe investment when it’s tied to literally the gambling casino called the financial market.
What happened to FDIC?
After the Dodd Frank Act, the insurance for the FDIC was expanded to include the Investment Banks as well. So now the government via the FDIC is going to provide insurance to bail out the banks that degeneratively gamble. . . And all of this is coming from the Dodd Frank Act that was sold to the public as a way to ‘stop bail outs’. . .
Yea, ontop of the ‘bail ins’ mentioned earlier. The FDIC is now using tax payer money to ensure tax payers after the tax payer uses their own money to insure the FDIC and all of this is some weird clown game of financial kangaroo shit. Like, the insurance amount of the FDIC hasn’t paced with inflation, none of this shit makes sense.
Yea. Great. Mhmm.
It was almost like there were multiple measures that worked cohesively and synergistically to reduce the rampant gambling degeneracy of Trust Fund Babies pretending to play Hedge Fund Manager with big money. Almost. Imagine being so retarded that you equate the ones and zeroes in your bank account to a quantized metric of intelligence. I genuinely pity people that are that retarded.
The true root of the issue
-was the repeal of the Glass Steagall act resulting in degenerate gambling and reduction of Interest rates for the returns on savings and safe investments. The degeneracy of this gambling is felt on all.
Even Alan Greenspan admits;
”I made a mistake in presuming that the self-interest of organizations
specifically Banks and others were such is that
they were best capable of protecting their own shareholders” -Alan Greenspan
But uh, instead of reverting to a better save in our financial regulations by re-enacting that act that we removed, we’ve instead decided to band aid ourselves with this Dodd Frank Act to make more hoops for people to jump through to remain as corrupt as they are. Instead of like, making it illegal, we’ve just made it slightly harder. What a Big difference (sarcasm)
So the FDIC is a scam (mainly because we don’t have Glass Steagall to mitigate tying the risks together), and it’s just a bail out for big business deemed too big to fail. Even though the businesses failed. All thanks to Dodd Frank btw.
Enjoy your free market capitalism served on a band-aid platter.
A Sham if you will.
I’ll probably get around to it, but in case I don’t, the CFTC is also a scam, a bunch of corruption in the higher echelons of this financial battleground posed as another useless committee disguised to ‘help investors’. I mean, have you looked at the SEC? Yea, practically twins.
The Dodd Frank act was to make swaps more transparent, but the CFTC can do things like delay the reporting requirements for months to years. So yea, a load of jack shit that did. What’s the point in putting on a circus for the public if you’re just going to roundabout do the same thing? Do these people have a mental illness? Like Kleptomaniacs, I swear.
As it turns out, the Derivatives market (that the CFTC works with) is magnitudes more money than your standard assets and liabilities of old fashioned equities. So there’s a fuck ton of money, meaning people are gonna try to game that system even more because there’s more at stake.
This is an old infographic but it’ll do;
So yea, lots of money, it’s obviously corrupt, duh.
*Not Valid Financial, Legal, Life, or Any Advice
Here’s a few notes of the shit post above. A sort of summary;
If a large institution that has your money deposited fails.
Then they use your money to bail in the institution.
If that fails, then the FDIC bails out the institution.
Which is as effective as the government using TARP funds to bail out the institution.
And people like you, who pay taxes, are just bailing out the institution.
So if you are a depositor and a tax payer, chances are you’re paying doubly so for the degenerate gamblings of these institutions.