Top Ten Financial Reform Loopholes

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Ezra Klein points us to a White House list of “The 10 Most Wanted Lobbyist Loopholes,” and it’s good reading. Here are my top four from the list:

5. Removing the Derivatives Trading Requirement to Protect Wall Street Profits.

6. Stretching the Derivatives “End-User” Exemption into a Hedge Fund Loophole.

7. Creating an “AIG Loophole.”

9. Letting Firms Make Loans Without Skin in the Game.

Why these four? Because they’re all related to limiting leverage. #5 is related because clearinghouses would require collateral for derivatives trades. #6 because it keeps the clearing requirement robust. (Clearing is a subset of exchange trading, and I assume that it’s the clearing requirement that the White House is really interested in here.) #7 because it would extend capital requirements to at least parts of the shadow banking sector. And #9 because it effectively limits leverage at both the consumer level and the mortgage originator level.

But the whole list is worth reading. Even in its current state the Senate bill is only OK, not great. Holding the lobbyists at bay is the minimum requirement for keeping it even that good.

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That means we're going to have upwards of $350,000, maybe more, to raise in online donations between now and June 30, when our fiscal year ends and we have to get to break-even. And even though there's zero cushion to miss the mark, we won't be all that in your face about our fundraising again until June.

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