“Derivatives are financial products, such as futures contracts, options, and mortgage-backed securities. Most of derivatives' value is based on the value of an underlying security, commodity, or other financial instrument.
For example, the changing value of a crude oil futures contract depends primarily on the upward or downward movement of oil prices.
An equity option's value is determined by the relationship between its strike price and the value of the underlying stock, the time until expiration, and the stock's volatility.
Certain investors, called hedgers, are interested in the underlying instrument. For example, a baking company might buy wheat futures to help estimate the cost of producing its bread in the months to come.
Other investors, called speculators, are concerned with the profit to be made by buying and selling the contract at the most opportune time. Listed derivatives are traded on organized exchanges or markets. Other derivatives are traded over-the-counter (OTC) and in private transactions.”
Nader speaks to Frank about his role in the deregulation of mortgage securities, (Fannie Mae, Freddie Mac), and goes on to blast him for his support of a bill that allows exceptions on categories of these derivatives.
This is an abridged transcript (given Rep. Frank’s “unique style of speaking”):
Nader: “In 2000 you voted for a bill that continued the deregulation of the burgeoning derivative racket and now he’s supporting a bill that has a huge loophole in terms of exempting trillions of dollars in certain categories of derivatives, and he hasn’t (interruption from Frank) he didn’t support a categorical ban on the use of derivatives”
Frank: Well first off all Ralph - (*insults)
“I had overwhelming Republican opposition to any regulation of derivatives and some democrats - we fought hard for it – we are establishing a great framework for the regulation of derivatives – we are moving forward in that ad we’ve done as much as we can politically - the fact is we had a political situation – the real irony – the right wing took control of government and ruined it they gave it a bad reputation and now that “we are trying on every front in to increase the role of government in regulatory area”, we run into this public opinion that says hey, those are the guys that screwed up Katrina so the frustration is that they are benefiting from their own (word could be) incompetence.”
“We are trying on every front to increase the role of government in the regulatory area”
One comment appeared on Real Clear Politics that sums that statement up nicely: “Power deludes and absolute power deludes absolutely.
The Bill over which Ralph and Frank were arguing:
An article explaining the bill which passed the House, from DSNews, (here) goes into some depth explaining how the bill is “watered-down”, and goes into the exceptions referred to by Nader.
Barney Frank, whose memory is on any given day, either selectively partisan, selectively self-serving, has not acknowledged at any time, that there was opposition to his continued support for continuing deregulation, he is also holding fast to partisan speak – 2010 is an election year, and Frank does face opposition in his district.
Barney Frank on the Campaign Trail (since 1972) Faces Opposition from one Conservative – Earl Sholley and one “Republican”, Keith Messina. Messina, who originally began his campaign as an Independent, has since jumped onto the “Republican” label. Messina however, is not a conservative. (Shades of the New York 23rd!)
Frank has decided to take his campaign online: In a recent series of videos, Frank answers questions on issues that were presented through the blog Reddit.com In Frank “speak” – one of the 5 videos are featured below – the balance are on YouTube here From why the Lesbian and Gay Community should not bother with protests, to why the Democrat Controlled Congress with a like minded President have not made good on their campaign promises, Frank goes into detail to “explain”.
Frank faces opposition in the 4th District from Earl Sholley, a conservative populist candidate running as a Republican. Sholley has his own campaign videos on YouTube, which appear to speak in plain language, about common sense solutions, and without partisan diatribe.
Keith Messina , a newly minted Republican candidate for the 4th Congressional district, has a video below. In a recent article from the Boston Globe, Mr. Messina “promised a fresh perspective” and went on to say that he “supports federal recognition of same-sex marriage.”
Since 1972 Barney Frank has developed a left-of-center reputation and been responsible for legislation and oversight that has not only impacted his own district, but the entire nation. The voters in the 4th district have choices - (see above), there is simply no excuse for those in the 4th to continue to impose this brand of politician on the rest of the country. Those outside the state of Massachusetts are encouraged to donate to the opposition cadidate of your choice. Research is suggested.
4 comments:
The game of Monopoly was based on actual principles of economics. Of course, its not just that simple. But its close enough. In fact, if you alter the rules slightly, print some money, grab a bucket of gravel from the driveway, and a simple game of skill like darts, you can simulate almost any element of the economy. Including economic growth, creativity, and ambition. You could even simulate world trade by playing 3 games at once jumping from one board to another. If you want the game to last indefinately, there must be some sort of limit placed on the individual accumulation of personal wealth. Otherwise, the game eventually ends with only one winner. There must be a limit. Nothing else will ever work. If you think you can prove me wrong, give it your best shot. Let me know how the game turns out. Just remember: Its fun to crush the other guy at the kitchen table with fake money, fake resources, and a fake economy. But in the real world, greed causes economic instability, actual hardship, suffering, misery, starvation, and death. Now, test your partisan theories and see if you can make them work. I'll say it in advance: Thats what I thought. Greed kills.
By the way, Albert Einstein felt the same way. Its not brain surgery. Its simple math.
Hello Anonymous - the problem is that we are currently playing with monopoly money - and Rep. Frank appears to be unconcerned about that fact - in fact contributing to the problem – (apparently he is no Einstein – and in fact, one can bet the house, that there does not exist an Einstein in the Congress or the White House, nor has there been since inception of our government or any other government) Deficit spending has been the norm for our Congress for the past 10 years, regardless of party affiliation- it has, however, gotten much worse in the past 6 months - The federal government is out of control - it is not a partisan observation, just a simple observation - and it is simple math - herein lies the problem - utopia does not exist - taxing the "rich" - (i.e. evil corporations and those who maybe got lucky and won a lottery or the majority of those in Washington) drives those very same entities to either move out of the country, or into another state, or cut back on personnel - eventually that causes a loss of jobs, and income for all the entitlement programs - the next in line, once the "rich" have fled, are the middle class, (someone has to foot the bill), and a general misery ensues. It is not about being "greedy" it is about being smart - example: Massachusetts houses homeless citizens in hotels at a staggering rate per day (you can Google), common sense would dictate that one would be able to purchase several hotels, feed, house, educate and/or put to work more citizens in one month with that type of change. No doubt Einstein was a genius, however in this instance; your citation does not make a whit of sense.
wow, second anonymous poster, the anger is apparent - now, agreed, however, the society at large, for over 30 years has been dummied down to the point where they are only able to factor entertainment - which is what got us into this mess in the first place - "rock stars", in my humble opinion, should not hold an elected office - and that is what we have - it is going to get worse, much worse, unless and until we, the people, wise up and start rejecting business as usual, partisan junk - we have the ability to vote, make the vote count, and if you can educate one or two of your friends or family to actually investigate a candidate, prior to pulling a lever - then all the better - what is so wrong is to place a political party above the needs of a nation - and if a member of a political party, feels that the nation should reject its basic principles than that individual should be rejected out of hand - there is so much wrong that could be fixed, what it will take is common sense, which apparently is lacking - when I hear the same old "line" coming out of some senator's mouth (again, regardless of party), it just makes me cringe - so get out, get up and do something, run for office, support the best candidates for the country - and yes, that means, choosing the best of two evils, vote your conscious - but vote - at the very least we have that left.
The same old partisan crap about the rich creating jobs and wealth. Sure, they create jobs. Thats a given. But the wealth is drawn from the majority and recirculated in the form of paychecks only AFTER the rich take their cut. Which is all too often obscene. When you continue to funnel too much wealth through the hands of too few, you end up with a bottle neck. The rich keep getting richer and the poor keep getting poorer. This even AFTER you account for wealth creation, taxes, jobs, ect. So the points made by Einstein way back in 1949 hold even more true today. Not to mention the similar views of Mariner Eccles (FDR's Chairman of the Federal Reserve), Ron Paul, Robert Reich, Edward Wolff, and nearly every other professor of economics in the country. You just can't maintain an economy based on a constant transfer of wealth from poor to rich. Its mathematically impossible.
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