The bottom line here is this world has reached a pseudo Capital system for all now to stand witness for this has been going on for a very long time. I will call it the insured Capitalist HAHAHAAAA.
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1. Ban OTC derivatives trading and tax derivatives traded on exchanges. Very cheap to collect through existing institutions. Also enables better transparency.

2. Require large financial institutions to be less leveraged than their smaller competitors.

Note: Do it as fast as the 90% TARP compensation tax was done. Then, afterwards, sit down to discuss only the numbers and time frames with those involved.

In a discussion with economist Myron Scholes, he reports that Scholes says derivatives traded over the counter should be shut down completely. Speaking at York University Stern School of Business recently, he uoted Scholes as saying: “the solution is really to blow up or burn” the over-the-counter market and start over. He included derivatives on stocks, interest rate swaps and credit default swaps that should be then moved into regulated markets.

The idea is simple and not that radical. A US law banning OTC derivatives and moving them to regulated exchanges would end a colossal ‘shadow banking’ fraud. Banks would not lose much more than already, but the world financial system would get back to ‘normal.’ OTC derivatives are unregulated precisely to hide risk and enable fraud by the banks. It is past time to end that. There is where the US Treasury and other Governments must focus, not on meaningless ‘transparency’ calls or trading bonus ‘justice.’

Wow

1. Robert Rubin, ex-employee of Goldman Sachs, assists Alan Greenspan in deflecting important regulation of derivatives. Citigroup’s balance sheet swells with CDS during his tenure.

2. In the fall of 2008, Goldman Sachs becomes so desperate for cash that they pay Warren Buffet a guaranteed 10% /annum on a $5 billion cash investment.

Goldman Sachs wasn’t making any money by underwriting IPOs during 2007-2008.They were orchestrating deals facilitated by elaborate swaps. AIG is proving to be the ashtray filled by other players. Congressional investigations should examine this series of deals.

The only way the AIG scandal will be addressed by the media is if the Justice Department sets an investigation in motion. In an audit of Goldman was done using values from Sept 14th prior to Lehmans demise and the free money train that passed through AIG, it would be the defining truth of whether or not Lehman failing benefited Goldman (and all of it’s affiliates and subsidiaries) or not. It is CLEAR that NOT taking AIG into receivorship benefited Goldman, and i don’t understand either, why no one except a hand full of people around the country, even noticed what how unsavory (euphamism) the “Lehman/AIG/switchtobankholdingdompanies/and finally TARP 1 dole outs ” look until the bonus issue broke.