Financial Reform Passes!
As someone who has had to prepare for the content of the bill, I will now:
1. Take a drink of water
2. Roll my head about in a patient arc
3. Make a slight modification to “Accredited Investor” calculations in a piece of software
4. Go about my business, proceeding apaceI’m amazed at how little wound up in the final draft post-reconciliation. We will now swear the economy is protected from complex derivatives - the biggest notional exposure in the world. We will continue to assume counterparties will perform. And we will recklessly assume risk, because nothing has been done to prevent bailouts.
Moral hazard for banks is now arguably a worse problem, because a popular president with a strong mandate to destroy hated banks blithely slapped our wrists instead. Look for a rally!
Politics.
