Comments on: The Bet That Blew Up Wall Street

Steve Kroft On Credit Default Swaps And Their Central Role In The Unfolding Economic Crisis

[wolfmann4u-2009]

Subject: Our Failing Financial Institutions

To Who It May Concern, OK here is the real story why our Financial Institutions are failing. In one word it is called Greed. It is so bad that it is built into our Capitol System. You had everybody in the housing market making big bucks, big commissions and loan fees etc, on getting people into buying overpriced homes they could not afford as long they all got their big commissions,and escrow fees etc. on top of national credit card debt and the price of gasoline, the war, offloading of American jobs, overpaid and compensated CEOs, and a host of other problems brought on by Greed. Who is going repay all the people that lost their Retirement 401k savings while the Democrats and the Republicans sit and blame each other? at least the Feds should give us a tax break against our Retirement 401k loses when we withdraw our money from these 401k Retirement accounts providing there is any money left. Send this E-Mail to your Stock Broker, CPA, and the people who handle your Money.----------- Thank You, The Wolfman

PS---- When you have Morons like Barney Frank and Chris Dodd and others over the Financial Banking Committee no wonder why we are in trouble. Where were they for the last 5 years ? Since April I am already down $55,000 in my Fidelity 401K Retirement Account and who is going to bail us out.

[credibility2]

It''s too bad that the delusional Obama supporters aren''t coherent or bright enough to fully understand, let alone comprehend the destruction to the economy their actions have caused, including Fannie and Freddie. And for them to buy into the political spin and blather that the economy is all the fault of Bush and the Repubs is beyond belief. The Dems in DC are a bunch of greedy mongrels.

[sammi23]

to "slownewsday" You forgot to put the "but" in McCain''s speech. It "probably" helped the growth of the economy, But he''s always been for more regulation.

[sammi23]

to "slownewsday" You forgot to put the "but" in McCain''s speech. It "probably" helped the growth of the economy, But he''s always been for more regulation.

[sammi23]

I guess it''s common practice for Democrate Presidents to sign papers without reading them?????? Scary!!!!
Just accept the blame where it belongs.

[tomnva]

I watched with amazement the half truths that were put forth as fact during this airiing. Thouse who were around and aware in 1999-2000 know that deregulation put forth by republicans after they gained control of the Congress was rampant. They were very good at getting a 2/3 majotrity or burying bill in buget acts. Credit Defauls are a Republican invention. They were very creative with Bank deregulation also. Democrats should demand 60 minutes do another story that tells all of the story!

[tomnva]

The "Enron Loophole"
The Commodity Futres Modernization Act was modified by Lobbyists from Enron working with Senate Banking Committee Chariman Phil Gramm R-Texas. ( McCain campaign financial adviser) The modifications exempted most over-the-counter energy trades and trading on the electronic energy commodities markets and were sought to set an atmospere of deregulation so Enron could exist. This portion of the bill was repealed by Democrats in 2007. H.R. 6124.

[tomnva]

The Gramm R-Texas,Leach R-Iowa,Bliley R-VA, Act of 1999 set the stage buy deregulating Commercial Banks. It gutted the Glass-Stegal Act of 1933 that set up guidlines that protected banks until the most recent collapse. 60 minutes should do another report that tells all of the facts.not just the ones that favor McCain.

[kchudy]

Americans, (we the people of course), are collectively fed up with circumstance in the US, and it makes me particularly grumpy, as it should make all of you. If what I''m reading is true. That the deregulation bill was buried in a "must" pass funding bill and very late in the 11th hour. Then this should push people to demand dramatic changes in the system. Maybe it should push the selective line item veto in the budget and for the elimination of all pork buried in legislation. We must be able to separate the two. Maybe, just maybe, it is finally time for a BALANCED BUDGET AMENDMENT! Americans (the people) would then have spoken through our collective states (as originally intended) with the demand of true representation for our collective good. Put the CONSTITUTION back to work for our nation, and stop those that consistently and completely ignore it! Simple premise; grand solution? Conservative nor liberal. Eliminate the politics and political parties to; demand government through honest faith in ethical beliefs and values, clearly defined and consistently applied, conservative and liberal, for the benefit of us all!

[jeremyash88]

Your story overstates the importance of Credit Default Swaps in the current crises. They are no more responsible for our present difficulties than cash stocks or bonds. It is my contention that the unregulated use of leverage in most financial companies is at the root of the crisis.

Over years of easy and overly transparent monetary policy combined with lax regulation wall street firms and their peers around the world were able to establish highly leveraged positions. The use of SIVs and other vehicles produced continuous demand for fixed income assets. Mortgage brokers and others rushed to fill this unrelenting demand for assets, at any price. The result was a dramatic lowering of credit standards and a substantial increase in the supply of debt. This rush of debt financing was not tracked by the Federal Reserve or regulated in any way. To this day the Federal Reserve has not been able to arrive at a cohesive strategy to de-lever the global financial system.

Many market participants have been able to say with certainty for months that many of the major banks are completely insolvent because they can view the actual trading levels of assets created in this debt boom and conclude that banks are overstating the value of these assets by more than 50%. It is no surprise that so many have emerged with significant profits as a result.

I would like to see a story on the role of debt financing in consumption in America and the role of our borrow to consume culture in this crisis.

[piercetheval]

...you see? The very same idea the Republicans were/are promoting, i.e. investing in the Stock Market/Securities et al is exactly what the pPublic Employees of Calif did...only en masse...and the Coporate Masters don''t like that...conclusion: ''They don''t give ahoot about your financial security in fact they abhor it!
They sold your "Roses" and left you with the manure!

[piercetheval]

...and as far as the Republicans ruse as to Cal/PERS...it didn''''t work because Cal/PERS is technically a "Private" system, founded by the employees wirh THEIR OWN MONEY...the fact that it comes from public funds to begin with is of no significance...the fact that the Gov''''t does pay into it with some matching funds is a contractural agreement that was produced to allow these various public entities to ''''offset'''' some financial obligations.
One has to remain vigilant in all times when it comes to greed...The high times of the past[since WW II] lulled too many of you into a false sense of security fuled by these very same people that have created the mess we are in by promising we could keep up with the ''''Joneses'''' through borrowing against a future THEY pointed to and promised as being "Rosey"...so...how do the ''''Roses'''' smell now?

[piercetheval]

And you can only begin to wonder what would have happened if the Republicans had gotten their way and got congress to approve the dis-mantling of Social Security and what would have hapeened to your money, your parents money and the future of your children had we started putting that money into the stock market. Esp. considering the ''''Dot.Com'''' bust that occured immediately afterwards.
And then there''''s Arnold whom tried the same tactic with the Public Employee Retirement System here in Calif.
The coporate masters want the highly influential Cal/PERS with their ''''Billions'''' in holdings and their powerful block of shareholder influence ''''out of the picture''''.
The main objective of the Republican party has been to dismantle the ''''New Deal'''' FDR gave us over 70 years ago.
It was working and would have continued to work as long as Americans had jobs and continued working.
But the coporate masters have outsourced those jobs, allowed American farmland to be sold to foreigners and are selling off our natural resources. [Why are we shipping trees and other raw material overseas to be bought back by Americans as ''''Cheap Goods''''?
Why have the anti-trust acts of the 20th century suddenly become largely ignored? Why is the media market being allowed to be bought up and controlled by just a few?
It''''s time to stand up for yourselves America...maybe throw open the window and stick your head out and shout....well, you Know What To Shout!

[epunum]

In the 60 Minutes 10/26/08 report on the deregulation of derivitives, including credit default swaps, the assertion is made that the responsibility for this momumental mistake rests with Alan Greenspan and Bill Clinton. This is either incredibly irresponsible journalism or an overt attempt to mislead. In either case, CBS News should be ashamed and embarrassed.

The bill that Congress passed and Clinton signed in December 2000 was an omnibus spending bill that had to be passed befor Christmas recess. Little known to anybody involved, Sen. Phil Gramm had added a 262 page amendment to the bill, at the last minute, which was the Commodity Futures Modernization Act. So with no debate and little knowledge, except by his cronies on Wall Street, Phil Gramm planted the time bomb that has led to the current crisis. The same Phil Gramm that is a senior economic policy advisor to John McCain and on McCain''s short list for Sec. of Treasury should the American people be brain dead enough to give him the chance.

Google "credit default swaps". It''s all there.

[pensacola98]

When I lived in Texas, my US senator was Phil Graham. I bought into his beliefs about deregulation and reducing government controls and spending. The Graham-Ruddman amendment sounded like a good idea to cut federal spending and meet a target goal in five years, or the entire federal budget would be chopped evenly across the entire budget. Then, after passing this amendment, Phil Graham did the unthinkable-he earmarked a 4.6 billion dollar super collider project in his home state of Texas. I never trusted him after that. It was no surprise that it was cancelled later after costs for the super collider escalate out of control.

It was no surprise that Phil Graham advocated to relax controls and deregulate the economy. One by one big companies were going bankrupt - Continental Airlines, American Airlines, Eastern Airlines, and that was just from one industry - thanks to Phil Graham''s fiscal policies.

It was no surprise that Worldcom went bankrupt and led to a cascade of bankruptcies to many firms in the telecom industries. More than one million jobs were lost and many telecom stocks devalued by over 90% - thanks to Phil Graham''s fiscal policies.

Then, we have Enron - again - thanks to Phil Graham.

Now, we have the mortgage meltdown - thanks to Phil Graham.

President Bush and John McCain love Phil Graham and his policies about relaxing government controls and pushing more industries into bankruptcy and more unemployment.

[easeup-2009]

I''''m done "blogging" because 85% of the people who have written comments are more interested in divisiveness and hate mongering.

Posted by josephstaman at 12:33 PM : Oct 27, 2008

Clinton''s fault.

[ddaryl1]

All I know is that this country has no hope of ever being great again. Not while there are republicans alive

[josephstaman]

mroutside appears to be a bigot!

[josephstaman]

After reading the posts of the past two days,I realize now why Steve Croft and the mainstream news people are not eager to do investigative journalism:the vast majority of people who tune in today are more interested in fighting and name-calling and not holding new people responsible for their jobs. I''m done "blogging" because 85% of the people who have written comments are more interested in divisiveness and hate mongering.

[whatithink10]

mroutside12,

Who did you blame for carving the "L" in the middle of your forehead?