Geithner: New Rules Of The Game

Treasury Secretary Tim Geithner lays it down:

"Over the past 18 months, we have faced the most severe global financial crisis in generations," Geithner said in testimony to the House Financial Services Committee. "To address this will require comprehensive reform. Not modest repairs at the margin, but new rules of the game."

A game. That is what it was. It was all just a game, using other people's money. In order to get out of this mess of a game, we have to fix what got us into it:

The administration's proposal, which will require congressional approval, would represent a major expansion of federal authority over the financial system. It would impose tougher standards on financial institutions judged to be so big that their failure would represent a risk to the entire system.

It also would extend federal regulations for the first time to all trading in financial derivatives, exotic financial instruments such as credit default swaps that were blamed for much of the damage in the meltdown.

The administration also wants larger hedge funds to be required to register with the Securities and Exchange Commission.

People will argue over more rules or better rules, but one thing is clear, we have to enforce the rules and have real penalties for breaking them.

Source: HuffPo