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Breakthrough in the United States: Senator Harkin Introduces Bill to Reinstate Glass-Steagall
Austrian Government: Arming the Syrian Opposition Is Illegal under International Law
Benghazi, Political Targetings, Blanket Confiscations: Impeachment Hangs over Obama
French Party Presents Draft Bill for Glass-Steagall-Type Bank Separation
Brecht aus dem Euro aus, um die Finanzoligarchie zu besiegen!
“Benghazigate”: Threat of Impeachment Hangs over Obama
Ex U.S. Defense Minister Robert Gates Opposes Intervention into Syria
Glass-Steagall LaRouche-Aktionskomitee demonstriert Stärke in Washington
Global Times: Schiller Institute Rep. Comments on “Chinese and American Dreams”
Week Of Action in Washington: Pass Glass-Steagall Bank Separation Law Now!
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British Parliament Hears Arguments for Banking Separation
That an open debate on Glass-Steagall is taking place in London should not be surprising since the City is the very heart of the financial cancer. Leading the charge, as we have documented, are regulators who wish to curb the power of the "state within the state", i.e. the City of London, and legislators who are witnessing the devastating economic and strategic implications of a prolonged world debt crisis and economic depression.
Thus, on Oct. 17, the Joint Committee on Banking Reform of the House of Commons held a hearing with Paul Volcker, former head of the U.S. Federal Reserve and author of the infamous “Volcker Rule”, to assess and discuss the "ring-fencing" proposed by the Vickers Commission and the Liikanen group. Volcker blasted that idea, saying that it has loopholes "likely to get bigger over time". "The concept that different subsidiaries of a single commercial banking organization can maintain total independence either in practice or in public perception is difficult to sustain", he said. For example, if the investment part loses share value, that will effect the shares of the commercial part. Volcker said that if you have the same name on two neighboring doors, that name is the garantor for both.
However, Volcker did not push for a return to the Glass-Steagall Act. His ambiguity prompted committee chairman Andrew Tyrie to ask him what kind of separation he actually supported. He then defended his "Volcker Rule" scheme, which is not a total separation a la Glass-Steagall, but only the separation of proprietary trading. He also insisted at the same time that an effective reform scheme should be extremely simple, which his rule, in the form of the Dodd-Frank bill, is certainly not.
The next day, the editors of the Financial Times correctly chastised Volcker's cowardness. In a commentary headlined "Split the difference", they wrote that "ringfencing – proposed by Sir John Vickers and the Independent Commission on Banking he chaired – and Mr Volcker’s own 'Volcker rule' largely stand and fall by the same arguments."
And further: "The best argument for full separation – and why this newspaper calls for splitting banks cleanly, not erecting fences within them – is the one Mr Volcker made for his own rule. The risk-taking culture of trading is antithetical to the conservative values that should govern retail banking; within a single organisation, the former is likely to seep through any ringfence to overwhelm the latter.
Compare the debate in Great Britain with the attitude of EU leaders and bureaucrats, like Italian puppet Prime Minister Mario Monti who claims ignorance on the subject of banking separation. At a press conference in Milan on Oct. 13, an EIR journalist asked the ex Goldman Sachs advisor if he finds it necessary to return to a separation, since the massive liquidity being injected into the system by the ECB simply goes to feed the speculative bubble on the financial markets, and never makes it to the real economy.
Monti, who was the President of Italy's most prestigious economics university, the Bocconi in Milan, from 1994 until 2011, answered that "on the question of the separation of commercial banks and investment banks… I haven't really looked into it much."
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Breakthrough in the United States:
Senator Harkin Introduces Bill to Reinstate Glass-Steagall
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New Book Demonstrates "Why Austerity Kills", and Needlessly So
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