Phil Gramm at AEI: Credit Default Swaps

AEI Event: "Is Deregulation a Cause of the Financial Crisis?" January 23, 2009 http://www.aei.org/event/1862

During the 2008 campaign season, the Democrats blamed the financial crisis on Republican deregulation, in particular the Gramm-Leach-Bliley Act of 1999 (GLBA) and the Commodity Futures Modernization Act of 2000 (CFMA). The GLBA repealed the provisions of the Glass-Steagall Act of 1933 that prevented affiliations between commercial and investment banks, and the CFMA, among other things, exempted credit default swaps and other derivatives from regulation by the Commodity Futures Trading Commission. Although both acts were backed by the Clinton administration, Senator Phil Gramm (R-Texas)--then the chairman of the Senate Banking Committee--was the key congressional sponsor of the legislation. Is it plausible to connect the GLBA and the CFMA with the current financial crisis? Former senator Gramm addressed these and other questions.

Category:

News & Politics

Tags:

• Phil Gramm
• AEI
• financial crisis
• credit default swaps
• CDS

[Lane4411]

Credit Default Swap's were recognized by Buffett as toxic in 2003!!!

[Lane4411]

Greeeeeee-Spannnnn

buffett realized this fact

[Lane4411]

Read "Bailout Nation", put the meltdown in perspective

[flanksteak1]

Not really Phil. The "risk" was thrust back upon the taxpayer and government and deposits were made here in the United States under the promise that they would be safe that otherwise would not have have been or at least they would have been deposited in regular banks and earned realistic interest rates.