naked capitalism

Doc Holiday says:

Yves,

I thought you were on the night shift; this seems out of character for you to be adding a story at this time of day. Yah going somewhere … huh, huh?

Re: “How the Federal government should oversee insurance”

That is a tough question and I can understand why no one had a clue as how to respond, because none of them have had experience with understanding regulation, implementing policy or doing anything to control their pet projects.

This is like doing a real-time live interview with a conductor of a runaway freight train and then everyone seems so frustrated about the questions and lack of responses.

Also see:

Runaway Train

Doc Holiday says:

Leo,

I agree 100% with you on Markopolos or people that have character like Warren.

This lack of regulation era, we live in, reminds me of a homeowner association, which elects people who all are eager to have power and to write new rules and to influence their control. I know my ownership association loves to spend money and change rules and then threaten people with new fines, but when it comes down to enforcing rules and apply equal implementation — they all fail, year after year and then seasonally, we seem to get new board members and new agendas and an attention deficit/circus atmosphere where nothing changes. Nothing will change in insurance or on wall street, because no one has a clue what they are doing, and this comes down to nepotism and situations reflective of Friends of Angelo and the corruption that seems to be embedded into organizational structures.

These boobs from the insurance industry obviously are clueless and linked to a lack of regulation and they are also linked to a lack of IQ, a lack of honesty, a lack of serving the public good — they are frauds and they need removed from our society by noon Monday!

Jared says:

Yves, this California story needs to be told. We’re all going to be bailing them out.

http://lewrockwell.com/north/north714.html

Don says:

It might help to know exactly what people mean by Systemic Risk. I see the current problem as Debt-Deflation. Consequently, I can propose various solutions to try and keep that from occurring again. For example, I like Narrow/Limited Banking. I can also see that as long as we have a Lender Of Last Resort, we cannot rule out Moral Hazard. No real government would tell people “Good luck” facing Debt-Deflation, especially if you have a LOLR. That’s basically what it means to have a LOLR.

I guess I’m arguing that a Systemic Risk Regulator will be mainly window dressing, although it probably would do some good, assuming that people don’t rely on its blessing as the word of God. Good luck.

Don the libertarian Democrat

Richard Kline says:

Yes, being a premature anti-capitalist _will_ be a hindrance for appointment to senior regulatory positions going forward. For all that, it is interesting how in this crisi, as in many, talent separates from mediocrity like alloy from dross when things start shaking. . . . It is even more telling that Bo Prez has brought NONE of this talent into positions of authority, which instead he busily packed with yesterday’s shills.

Regarding CA: As a former resident there, I think the country should most assuredly NOT bail them out _until and unless_ they repeal that swinish property tax cap, their tax-blockage two-thirds majority legislative tax collar, and mandate a rainy day fund of sizeable proportions, all as part of their political framework for sound financial policy going forward. Then, yes, bail out their sorry assess. Down there in Sunshine Land they have lived the grasshoppers’ life for a generation, refusing to tax themselves at an appropriate level for the things of the good life. Their disaster is substantially self-made, just as they always tell the rest of us that as well was their success. They didn’t tax themselves during the recent bubble-boom, _but instead borrowed at stiff interest during the good times_. Now, their deficits and bod service are become so massive that they truly risk the collapse of state services. Tell them to do their part before they come to the rest of us sun-visor in hand.

JSD says:

This hearing is steeped in many years of political posturing and manuvering. The real issue is Optional Federal Charter and whether the insurers should be granted a dual form of regulation similar to the banks.

I would argue that the hearing participants are debating over how many angels may dance on the head of a pin, while the committee members seek out bits and pieces of testimony to forward preformed agendas.

For more information:

http://www.insurancenetworking.com/news/insurance_optional_federal_charter_regulatory_reform_campaign_contributions-12351-1.html

This will be an interesting test for the Obama administration. Will it take a pragmatic approach to financial services regulation or simply become a water carrier for big interests.

OFC is the wrong answer searching for a problem however it is supported by large insurance companies such as Allstate, State Faarm and Hartford. Obama just appointed the former President of a property and casualty division of Hartford to the Treasury Department.