{"id":220017,"date":"2010-01-23T11:58:44","date_gmt":"2010-01-23T16:58:44","guid":{"rendered":"http:\/\/www.businessinsider.com\/you-fools-prop-trading-is-what-saved-the-big-banks-2010-1"},"modified":"2010-01-23T11:58:44","modified_gmt":"2010-01-23T16:58:44","slug":"you-fools-prop-trading-is-what-saved-the-big-banks","status":"publish","type":"post","link":"https:\/\/mereja.media\/index\/220017","title":{"rendered":"You Fools, Prop Trading Is What SAVED The Big Banks!"},"content":{"rendered":"

From Asia Times<\/a>:<\/p>\n

I have boundless regard for Paul Volcker, but the proposed restrictions on bank proprietary trading are, well, fixing the barn’s roof after the horse has bolted. The Obama administration really, really<\/em> doesn’t get the joke. The banks went bankrupt by loading up on supposedly ultra-safe, AAA-rated assets, spawned out of the derivatives hatcheries with the collusion of corrupt rating agencies (who made most of their money rubber-stamping these time bombs).<\/p>\n

They did NOT, NOT, NOT blow up taking risky proprietary bets. Yet the rating agencies (who claim no liability for mis-judgments on the grounds that they are exercising the same Constitutionally-protected free speech as a newspaper editorialist!) are in charge of rating credit quality.<\/p>\n

Proprietary trading is what SAVED the banking system earlier this year. I laid this out in advance exactly a year ago — on Jan. 23, 2008 — in an essay for Asia Times entitled, “Fixing the bank crisis is the easy part<\/a>.”<\/p>\n

Read the whole story at Asia Times ><\/strong><\/a><\/p>\n

Join the conversation about this story »<\/a><\/p>\n

See Also:<\/b><\/p>\n