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Kevin Yoder, Citigroup's Waterboy

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  • Kevin Yoder, Citigroup's Waterboy

    News reports point the finger at Kansas congressman Kevin Yoder for insetting the language in the Chromnibus that was written word for word by Citigroup. The provision, written by Citi's lobbyists, permits the big banks to make unregulated derivative trades with FDIC-depositor insured funds. This means if their bets go bad (like they did in 2008), we the taxpayers will be on the hook in the fund gets depleted (which it did in 2008).

    Citi was the sickest of the large banks after the Great Recession, the last to pay their bailout money back, and was teetering on the brink of insolvency in 2008.

    Word has it that Mr. Yoder is hiding, I would be too. If he's your rep, grab your pitchfork and go after him.

    Let's hope the Kansas Republican Party can field someone against him and get him primaried. Someone this dumb doesn't deserve to represent his constituents.

  • #2
    Originally posted by shocka khan View Post
    News reports point the finger at Kansas congressman Kevin Yoder for insetting the language in the Chromnibus that was written word for word by Citigroup. The provision, written by Citi's lobbyists, permits the big banks to make unregulated derivative trades with FDIC-depositor insured funds. This means if their bets go bad (like they did in 2008), we the taxpayers will be on the hook in the fund gets depleted (which it did in 2008).

    Citi was the sickest of the large banks after the Great Recession, the last to pay their bailout money back, and was teetering on the brink of insolvency in 2008.

    Word has it that Mr. Yoder is hiding, I would be too. If he's your rep, grab your pitchfork and go after him.

    Let's hope the Kansas Republican Party can field someone against him and get him primaried. Someone this dumb doesn't deserve to represent his constituents.
    Democrats aren't really mad about this, they're just jealous.

    I'm guessing you don't support Tea Party types who actually practice what they preach about Accountability and Transparency in Government.
    "Don't measure yourself by what you have accomplished, but by what you should accomplish with your ability."
    -John Wooden

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    • #3
      And I guess you're nota libertarian wu_shizzle, since you seem to favor indirectly subsidizing banks when they lose their insured bets and ask for another bailout!

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      • #4
        Originally posted by shocka khan View Post
        And I guess you're nota libertarian wu_shizzle, since you seem to favor indirectly subsidizing banks when they lose their insured bets and ask for another bailout!
        I was not and am not in favor of bailing the banks out in any way shape or form. If they make bad decisions, they should pay the price. That seems like a common sense key check and balance on banks that needs to happen, IMHO. The FDIC should be there to protect American citizens from bad bank decisions (or even uncontrollable situations like natural disasters) that cause banks to fail, not to protect the banks themselves. I agree with you that using the FDIC to bail out a bank for making bad decisions is bad mojo. Banks should carry their own insurance if they seek to be other than self-insured, and that insurance should not be from the federal government, IMHO.

        If a bank is "too big to fail", doesn't that just mean it's a monopoly and should be split apart? How can it not mean exactly that?

        But I do have a disagreement with you regarding the blanket demonization of derivatives. Used properly, they are actually a very useful device for _reducing_ risk, not increasing it. My gut tells me they don't need to be placed in a public exchange in order to reduce the use of them in a speculative fashion. What does need to happen, bare minimum, are strong regulations surrounding the reporting and clearing of transactions.
        Kung Wu say, man who read woman like book, prefer braille!

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        • #5
          Kung, I agree with your points. No one has asked me what I think about derivatives in general. In general, I think they are useful tools, but I believe that they should not be used to speculate.

          Banks were using derivatives (and still do) to speculate.

          For instance oil prices. Some oil companies hedge to make sure they are covered if the price of oil goes down. I get that. Airlines hedge to make sure they can lock in a stable price for fuel. I also understand that. Banks hedge on interest rates to manage revenues and smooth income. Hedging without a good business reason is somewhat akin to going to the casino.

          Just my $.02.

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          • #6
            Sorry to be spamming, but one example I can think of regarding a bank investing in derivatives without an economic justification would be when Goldman Sachs was pushing up the price of oil futures. What economic position is GS hedging? They're an investment bank. There was NO economic purpose behind the hedging, which means it was speculative.

            Banks either ought to have all their federal subsidies and protections taken away from them (the pure libertarian model) or they should be prohibited against hedging (to protect the public) for speculative purposes.

            Banks purchasing derivatives to make money on trading is disruptive to efficient economic markets, IMO.

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            • #7
              I also think that Mr. Yoder would not know what a derivative was if it jumped up and bit him in the @$$. He's just doing 'what the lobbyist told him'.

              He needs to do what the people in his district want him to do, not what a lobbyist wants him to do.

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