A brilliant piece by MIT Professor Simon Johnson about the new Obama bank plan. As I’ve stated in a previous post I think this latest plan, while lacking on details and poorly presented (in terms of timing and meat on the bone) is generally a step in the right direction. It does not however solve the issues that found us in an ever tighter bust-boom cycle. For the first time since the president took office he has taken a positive step forward on the economy, of course it has not been met with much glee and Wall Street is throwing a hissy fit and gearing up their lobbyist to defeat any plan that might limit their power. How Obama and the Congress deal with this and other important issues regarding our financial system will determine whether the future course of our nation is one of prosperity or doom.
Of course regardless of if any financial reform is undertaken or not, if we don’t stop our massive deficits, nothing else will eventually matter. Republicans have a chance to redeem themselves with the American people by helping to vote down Ben Bernanke and then joining with Obama on real financial reform. If they instead decide to oppose simply based on being the opposition party, while they may win a short-term victory, they will have doomed themselves and their party forever. I could care less about “bi-partisanship”, its time each and every congressperson stepped up to the plate and delivered for the American people. I have little faith this will happen, but at least it can be said they were given a second chance before getting the boot (that goes for both parties).
Scott Dauenhauer CFP, MSFP, AIF