Quote:
Originally Posted by dc_dux
Banking (which was deregulated to blur the line between commerical banks and investment banks) and auto manufacturing (which successfully fought any new regulations for the last 20 years) are hardly the most regulated industries.
Food and drugs, other consumer products, insurance, utilities, health care, solid waste disposal...... are regulated much more than banks and auto manufacturing.
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By what standard do you measure your view? In my view banking is directly tied to monetary and fiscal policy, totally controlled and regulated by government. Bank charters, reserving, investment, accounting, financial reporting, even FDIC and all other aspects of their operations are controlled by federal or state regulation. They even have a mandate to loan funds to targeted areas or risk their charters. Fannie and Freddie central in home loans are quasi-government entities, they virtually control the home loan market.
I could continue but those who get it, got it already and to those who don't it won't make a difference.
-----Added 10/12/2008 at 01 : 17 : 08-----
Quote:
Originally Posted by highthief
It is lack of regulation that led to the banking disasters in the US.
In Canada, there are much fewer banks, more regulation, but no Canadian bank will fail. The concept is virtually unheard of here, while US banks fail constantly.
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This is not correct. You don't cite a source so I don't know where to begin in terms of countering this claim. One thing you can help with is to specify what deregulation you refer to.
-----Added 10/12/2008 at 01 : 23 : 40-----
Quote:
Originally Posted by Willravel
The truth is that the opposite is true. Nowhere is the more clear than in the case of Fannie and Freddie, which actually started failing as regulations became more lax.
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Analogy alert. Read at your own risk.
It is like a person in federal prison. Everything they do is controlled, they are under guard (like being heavily regulated), but then you have a prisoner commit suicide. On the surface one could conclude that they were not controlled and under guard since they committed suicide. Kinda like Fannie and Freddie, they were controlled and under guard, but they still took suicidal actions. On the surface we could say they were not regulated, but the truth is they were. The problem was just like with the prisoner we did not account for and "regulate for every possibility for suicide. Live and learn.
Analogy alert ended.