Treasury Housing Plan: Note What's Missing

Karl Denninger submits: Some eye-rolling is to be had with the "Housing Finance Market" report to Congress. You knew they'd come up with something "measured" and that Geithner would lie. After all, that's what he always does. Going forward, the government’s primary role should be limited to robust oversight and consumer protection, targeted assistance for low- and moderate-income homeowners and renters, and carefully designed support for market stability and crisis response. Our plan helps ensure that our nation’s economic health will not be jeopardized again by the fundamental flaws in the housing market that existed before the financial crisis. At the same time, this plan recognizes the fragile state of our housing market and is designed to ensure that reforms are implemented at a stable and measured pace to support economic recovery over the next several years. Uh huh. That's a nice expectation. Now let's see what you have in here. Nearly eighty years ago, in the midst of the Great Depression, the federal government began implementing sweeping reforms to the American financial system. These reforms – deposit insurance, limits on the risks banks can take, better transparency and investor protections in securities markets, a stronger Federal Reserve – helped build a financial system that provided a solid foundation for America’s unprecedented prosperity. A foundation that was then destroyed systematically and intentionally, first by eroding Glass-Steagall through circumvention and unprecedented and intentional lawless behavior by Citi's (C) merger which the Federal Reserve allowed (despite it being black-letter illegal), sweep account games (which wereComplete Story »