Page 160 - Aig News Today

Goldman can claim victory here as well. right? >> yeah, thats right. many analysts thought that the sec would get at least a billion dollars out of goldman. but its paying about half that. it has to change some of its marketing practices but just for three years. and the justice department did not file any criminal charges against the company here is the kicker. goldman stock is up $7 a share. look how it spiked yesterday afternoon. so the settlement added 3 bone $6 billion to goldmans market va...

Boehner said it institutionalizes too big to fail. it allows a big bank to to fail. we had aig and lehman. it was very difficult to deal with those banks when they got into a crisis situation. this will make it easier. its not foolproof. probably not possible to construct a system thats foolproof but it makes it easier to shut down one of these giant banks if they get into trouble. >> dean baker, co-director for the center of economic and policy research, thank you again for your time tonight. ...

Interconnectedness. >> i think it very much addresses a whole bunch of the aspects that made these institutions quote unquote too big to fail, like the over the counter derivatives which threaten to blow up aig, theyre now coming out of the regulatory umbrella and coming out of the shadows, so if some institution gets themselves in trouble, they can be broken up and sold off into pieces, they cant be bailed out. they cant hold the government hostage and i think you can address some of the issues...

Thing. the fact you can be confident there are no surprises in there and it says what you think it says, thats good news for people. i think it should be good politics. >> from the reverse side, even if the gop gives up on the idea and says lets repeal it, what will theyç demonize? >> youve heard representative boehner said it institutionalizes too big to fail. it allows a big bank to to fail. we had aig and lehman. it was very difficult to deal with those banks when they got into a crisis sit...

Protection agency. so when youre using things like credit cards or getting a loan, this is supposed to stop companies from unfair practices. one of the other things it does is, it regulates derivatives. may recall those really complex financial products that when they flopped, brought down lehman brothers, would have brought down aig, had the government not stepped in there. so it regulates those derivatives an also it gives the government winddown power. this is something the government can do ...

Say sarah palin was half right about our legislation. we have death panels but theyre not in the health care bill for old ladies but in this bill for banks. the power of the federal reserve, section 13-3 of the federal reserve act used to prop up aig and pay off their debts is repealed. there will be no more power from the federal reserve unilaterally to do that as they did in 2008. secondly if an institution gets to the point where it cant pay its debts as aig did this bill says it dies and is ...

Their eye on the dow. so this is what it coming down to. mainly, i should mention, a democratically backed bill, tony. >> whats in this legislation? >> reporter: there is a number of things. were talking thousands of pages of but to boil it down to a few, one of the big ones, it establishes a consumer protect agency. you use credit cards, youre getting a loan, this is supposed to say to companies they cant participate in unfair practices. it would regulate derivatives, the complex financial prod...

Regulate derivatives. those really complex financial products, that when they flopped, caused lehman brothers to tank, would have caused aig to tank if the government hadnt stepped in. and one of the big things, it gives government the ability to wind down a big financial firm thats in trouble. pretty much the way you see that the fdic does with banks, tony, it would give the government that. >> why the partisan divide here? i know there is significant republican opposition to this. as you just ...

Protection that you didnt ask for, kind of like the old mafia protection. you got protection and they almost encourage you to overdraft your check and then hit you hard on it. as to mortgages, the single biggest cause of the problem were people getting mortgages who shouldnt have gotten them because there was a mistaken view that ive long been critical of that you make everybody a homeowner when many arent able to. that will be made flat out illegal. so the consumer protection will be very stron...

Of the main points is a consumer protection agency. if you get a loan, use a credit card, this is supposed to stop unfair practices. another thing it would do is regulate derivatives, the really complicated financial products that when they flopped, took down lehman brothers, could have taken down aig had the u.s. government not stepped in. it regulates those. and also it gives the government the ability to wind down these huge financial firms, if they flounder. the way they do with basically ba...