Forget the Fed: The FIRE Economy Rules

[EJ]

Forget the Fed

Part I: The FIRE Economy Rules

by Eric Janszen

Central banks have two primary stated purposes: maintain commodity price stability and protect the banking system. The gold standard did a decent job of maintaining price stability all on its own, allowing markets to automatically determine interest rates instead of central banks. As recently as 1997, not coincidentally during the last white-knuckle currency crisis, Greenspan recommended in on-the-record testimony to Congress that the US return to the gold standard for that reason. In a parting speech before getting out of Dodge in 2006 and handing the reins to Bernanke he suggested that the Fed come up for review every year and dissolve unless Congress voted to continue it.

There are many ways to interpret this. Ours is that Greenspan did his job for 18 years–assisting the purveyors of the FIRE Economy in Congress and the White House with monetary policy that spurred the development of first a stock market and then a real estate asset bubble, knowing the negative consequences for the economy and financial system all the while he helped to take us down that road. That is what he was asked to do, and so he did it. Sensing the approaching crisis in early 2006, he wanted to leave at least a trail of breadcrumbs back to what was left of his sense of duty to his country and his fellow citizens. Perhaps he was thinking, "You elected them. I just did my job. After what happens next, you're not going to want a Fed, and here I am on the record agreeing with you." Or something like that.

Despite Greenspan's recommendation, or some might say because of it (going on the gold standard today is a guaranteed path to a 1930s style debt deflation that transfers wealth from debtors to creditors), a major limitation of the gold standard is the inability for a central bank to expand the money supply enough to stimulate demand to prevent a deflationary depression from developing after a major financial crash.

The Fed created the conditions for the 1929 crash in the first place by keeping interest rates too low too long, just as the Greenspan Fed laid the foundation for the 2000 stock market bubble collapse with loose monetary policy in the late 1990s, and inflated the nascent housing bubble with very low rates in 2001 and 2002. The Fed under the gold standard compounded the error of too much liquidity in the 1920s by supplying too little in the 1930s. The Fed was stuck creating inflation the only way possible under a gold standard; after gold was recalled in 1933 via Presidential Executive Order 6102 and re-priced by approximately 30%, the money supply expanded and the run-away debt deflation halted. But by then it was too late; the U.S. economy contracted by a stunning 27% between 1929 and 1933, creating massive unemployment and hardship, setting in motion the political reflex to raise trade barriers which sank the U.S. economy even further.

After going off the gold standard completely in 1971, in the early 1980s the Fed took on a third unstated objective–to create continuous asset price inflation. The Fed, while more politically independent than most quasi-government institutions, cannot be completely free of influence from the executive and legislative branches of government. Famously, the Fed under Arthur Burns was heavily influenced by Nixon in the 1970s. The result? A lot of spending and inflation.

Since the early 1980s, as the U.S. economy came to be dominated by the finance, insurance, and real estate industries–the FIRE Economy. The Fed took on the role of serving the interests of those industries, in addition to the stated obligations of maintaining commodity price stability and safeguarding the banking system. (For a description of the FIRE Economy, see Saving, Asset-Price Inflation, and Debt-Induced Deflation.)

The collapse of the housing bubble and resulting credit crunch, if allowed to continue, the credit bubble contraction represents a failure by the Fed to maintain continuous asset price inflation to continue expansion of the FIRE Economy. As the FIRE Economy is now a much larger part of the total economy than the Production and Consumption Economy, we expect the resulting downturn, if the credit contraction cannot be halted and asset prices cannot be re-inflated, to spill over into the so-called real economy, producing commodity price disinflation, but not outright deflation.

At this time, market insiders believe that the Fed in cooperation with global central banks can achieve asset price re-inflation (reflation) without crashing the dollar. However, that view can change suddenly and may after Wall Street fund managers get back from vacation, where they've been in touch by Blackberry and WiFi connections from their hotel rooms, but haven't yet collected in staff meetings to discuss where they stand.

The precise outcome of the current credit crunch is unknowable because political dependencies are more important than technical factors and these are notoriously unpredictable. While many proposals have been put forward to bail out homeowners, historically, unless a single party or administration stands to take the blame, nothing will get done. Sometimes even if an administration does stand to lose politically, nothing gets done. Katrina comes to mind. Be careful not to confuse politicians' pronouncements that "something must be done" with actual something doing; as we say in the high technology business, never confuse selling with installing. Nonetheless, we remain confident that Bernanke, who has been writing about asset deflations since the time the FIRE Economy was invented (See: Bernanke, B. (1983) "Nonmonetary Effects of the Financial Crisis in the Propagation of the Great Depression," American Economic Review, Vol. 73, 257-276.), the US economy will not experience a run-away asset price deflation with collapsing commodity prices following a negative rate of inflation.

The likely trajectory of the declining asset price and credit bubble ranges from a controlled debt deflation attended by further dollar depreciation that gradually reduces the purchasing power of the dollar while allowing debts to be repaid due to lower real interest rates, to a more dramatic crash that spikes interest rates and inflation. No one can say for certain which is more likely to happen, but I can tell you how you may know that the process is over.

A Modest Proposal

The finance, insurance, and real estate industries need to be regulated the way the tobacco industry is now regulated. After forty years of pressure on Big Tobacco from anti-smoking advocates, and the deaths of a few million smokers, the truth is now common knowledge: smoking will kill you. Some day what you know about the FIRE Economy will be common knowledge.

The analogy to the finance, insurance, and real estate industries is that excessive debt, insufficient savings and equity, and overweight allocation of investment in real estate will financially kill you. This is obvious to iTulip readers, just as the dangers of smoking were to experts such as doctors and interested amateurs. But the idea that being overweight real estate and financial assets may be financially devastating is revelatory to the vast majority of the US population.

Focusing on the Fed, while supplying a handy punching bag for critics on both the left and the right, does nothing constructive to address the massive challenges facing US markets and economy. Get rid of the Fed and the finance, insurance, and real estate industries will find a way to influence the institution that is developed to take the Fed's place. What is needed is reform of FIRE Economy industries.

Reformers need to take a page out of the anti-Big Tobacco play book. What undid Big Tobacco was a combination of whistle-blowers and dramatic presentation of hard evidence until public opinion finally turned. Reversing the influence of Big Tobacco did not involve a lot of complex new regulation. All that was required to bring down Big Tobacco were changes in advertising guidelines and in the product labeling rules. That's it. The same can be done for the credit card and real estate industries.

Imagine our world after the FIRE Economy no longer dominates the national economy. You will see anti-debt ads on TV that explain, for example, why you should not use credit to purchase depreciating assets, such as expensive automobiles. The ads will show how depreciating assets need be purchased with cash out of savings, otherwise the buyer is renting his or her future labor to a bank at a discount.

Imagine going to a bank for a mortgage and being walked through a checklist that shows how large your monthly payment on your ARM will be if interest rates increase by one percent, three percent, five percent, and so on, along with probabilities of these rate changes occurring after the fixed rate period ends.

Imagine that credit card contracts were subject to the same Plain English rules as the SEC requires for stock offerings, short and in large print.

Imagine a time when you can purchase credit products with the same sense of security as you have when you buy food at the grocery store, due to government quality standards and regulations–some imported products, excepted.

Imagine that when you signed up for a credit card you have to acknowledge that you understand that if you have an $8,000 balance on a credit card account that charges 18% interest, if you only make the minimum payments you will not repay the debt for 25 years and will pay a total of $24,000.

Imagine the reinstatement of usury laws, tying the maximum interest rate that can be charged on a credit card to a multiple of LIBOR, so that the poorest members of society who cannot open bank accounts do not have to cash their paychecks at paycheck outlets that charge between 600% and 1,800% annual interest rates.

These are just a few modest changes to current rules that can dramatically change the economic landscape and re-align the interests of borrowers and creditors.

Gone today are ads on TV that show suave young couples smoking menthol cigarettes at the tennis court. No more billboard ads by the highway depicting rugged cowboys smoking on horseback. In retrospect, those old ads look ridiculous, outrageous. Some day we will look back on the ads for credit cards and mortgages that bombard us on TV and in our email in-boxes as just as outrageous. Then you will know the FIRE Economy is back where it belongs, as an agent of the production and consumer economy, not its slave.

Part II: The Politics of FIRE (iTulip Select)

At the rate we're going, won't be long before each of us takes our paycheck and cuts it in half, with 50% going to the banks we borrow from to eat, put gas in the car, have a place to live, go to school, and receive medical care, and 50% to the government to pay taxes, with an allowance paid back for discretionary consumer spending in proportion to each taxpayer's support of FIRE Economy pols. more...

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[Rajiv]

Imagine that when you signed up for a credit card you have to acknowledge that you understand that if you have an $8,000 balance on a credit card account that charges 18% interest, if you only make the minimum payments you will not repay the debt for 25 years and will pay a total of $24,000.

I would modify it to say that no more introductory rates, no more grace periods for payment -- treat credit card money to be what it is - A LOAN. Interest rate to be readjusted at fixed periods e.g. yearly.

Reduce costs to customers of using debit cards - after all the money is coming from the customers account -- and is not a loan. The transaction fee should be applied to both Debit and credit card usage -- as both are being used for convenience by the customer in lieu of cash.

[FRED]

I would modify it to say that no more introductory rates, no more grace periods for payment -- treat credit card money to be what it is - A LOAN. Interest rate to be readjusted at fixed periods e.g. yearly.

Reduce costs to customers of using debit cards - after all the money is coming from the customers account -- and is not a loan. The transaction fee should be applied to both Debit and credit card usage -- as both are being used for convenience by the customer in lieu of cash.

Better yet, disallow credit cards for a wide range of purposes and allow only debit cards instead.

[DemonD]

Better yet, disallow credit cards for a wide range of purposes and allow only debit cards instead.

I heartily disagree.

The first post on this thread has made great points and suggestions. This suggestion is bad bad bad in so many ways, but primarily in one: ID theft and fraud. My main CC is very very good and will lock down my credit card if they see any unusual activity. I can even call them and say "Hey, I'm going to this place or I'm going to place an order here."

With a credit card, if your card is stolen and used, you are not liable to pay back the money. With a debit card, your money is withdrawn, and then getting it back is a pain in the ass.

I think plain-language rules and a tighter regulation, like tobacco, would be great. Tobacco also has an age 18 limit. There have also been some restrictions started to be placed, for example wal mart was denied an industrial loan corporation status. Maybe college campuses should not be allowed to have CC fundraising desks. Continued reforms are great; but to eliminate credit cards for many consumer applications would be a vast inconvenience and an even greater security risk to the many consumers like myself who use credit cards responsibly.

[Rajiv]

I think my suggestion is still good. Pay primarily by cash or check -- by credit card - only if you wish to take out a short term loan.

[c1ue]

Ordinarily I'm pretty laissez faire on when people get into too much trouble due to ignorance...and this time is no exception.

Certainly ignorant people were victimized, but there is no way to legislate economic sense into a population except through painful object lessons.

The Great Depression worked pretty well - 2 full generations went by before the lessons were forgotten.

Just as Albania got taught a lesson in Ponzi schemes, the general population eventually has to learn there is no free lunch.

Otherwise, the time spent washing the dishes to pay off the restaurant bill just gets postponed and extended.

[Rajiv]

My problem is that credit cards are handed out like candy to young economically naive people -- and the practices I outlined earlier are, in my opinion, methods of entrapping naive "marks"

[zoog]

Ordinarily I'm pretty laissez faire on when people get into too much trouble due to ignorance...and this time is no exception.

Certainly ignorant people were victimized, but there is no way to legislate economic sense into a population except through painful object lessons.

The Great Depression worked pretty well - 2 full generations went by before the lessons were forgotten.

Just as Albania got taught a lesson in Ponzi schemes, the general population eventually has to learn there is no free lunch.

Otherwise, the time spent washing the dishes to pay off the restaurant bill just gets postponed and extended.

Agreed. Sometimes I think we go too far in trying to protect people from themselves. Like guardrail fences at the Grand Canyon.

Changing public perception and understanding about credit and debt is no easy task.

If you simply take all the credit cards etc away, they will despise you for making life more difficult. For many people, access to credit is the only way they are avoiding bankruptcy.

If you let people keep what they have, but severely restrict access to new credit, they will despise you for discriminating against everyone except the small minority who don't really need the credit.

If you force lenders to make honest and thorough disclosures about the risks involved, most people won't pay attention, unless they have had to feel the pain of trying to pay off previous debts. Don't think I'm right about this? When's the last time you actually read one of those privacy policy disclaimers that occasionally accompany your monthly statement? No one sits up and takes notice until they've been burned.

[Rajiv]

Let me ask you a question -

Would you use a credit card at 18% interest rate for all your day to day purchases if you did not have the grace period to pay it off -- in other words you were charged that interest every month -- wouldn't you rather pay by cash or check?

[zoog]

Let me ask you a question -

Would you use a credit card at 18% interest rate for all your day to day purchases if you did not have the grace period to pay it off -- in other words you were charged that interest every month -- wouldn't you rather pay by cash or check?

Sure... after I had to pay that interest the first time.:eek: ;) Then I'd complain about why did they give me a credit card if I can't use it to float. I would blame "them" rather than acknowledge that I should not expect to get a free one-month deferment on paying for my groceries and gasoline. We've all been taught that this is normal and expected. Not only do consumers have to feel pain, they have to feel pain in such a way as they have no alternative, at least eventually, but to blame themselves. Then they will change their credit spending habits.

[GRG55]

I heartily disagree...

...Maybe college campuses should not be allowed to have CC fundraising desks. Continued reforms are great; but to eliminate credit cards for many consumer applications would be a vast inconvenience and an even greater security risk to the many consumers like myself who use credit cards responsibly.

My problem is that credit cards are handed out like candy to young economically naive people -- and the practices I outlined earlier are, in my opinion, methods of entrapping naive "marks"

I wonder why there isn't a rechargable "cash card", similar to a pre-paid mobile (cell) telephone SIM card? One that does not provide access to a bank account other than for recharge purposes. Would be more convenient than cash, more secure than credit/debit cards. Does anyone know if this is how places like Finland are using mobiles for consumer purchase charges (deduct it from SIM balance)?

My times have changed... when I graduated from engineering school in the late '70's, just weeks before starting my first professional job, I received in the mail a credit card solicitation from a national bank - one where I held a savings account dating from my paper route days. I went to the local branch with the solicitation and proof of employment with a Fortune 100 multinational. They advised me they were in error, and that indeed I could NOT qualify for a credit card until I could show at least 3 months of post-graduate income. Imagine that today...

[dbarberic]

I wonder why there isn't a rechargable "cash card", similar to a pre-paid mobile (cell) telephone SIM card? One that does not provide access to a bank account other than for recharge purposes. Would be more convenient than cash, more secure than credit/debit cards.

This product does exist. Wal-Mart is pushing a "Visa Cash Card" where you can bring in your paycheck and convert it to cash on the Visa Cash Card for a rate lower than if you converted to actual cash. It basically works like a Visa gift card but you "re-charge" it by cashing in your paycheck at Wal-Mart.

Wal-Mart's end run-a-round into the banking business.

[c1ue]

Would you use a credit card at 18% interest rate for all your day to day purchases if you did not have the grace period to pay it off -- in other words you were charged that interest every month -- wouldn't you rather pay by cash or check?

You are assuming several things:

1) That someone knows what the full economic costs of that interest means over time

2) That they are not willing to assume this cost

3) That they feel the economic pain of their decision

Only tightwads like me (and evidently you ;)) have gone through all 3 steps.

I actually use credit cards for everything, but also pay my bill off every month. Actually makes accounting easier plus I get the CC perks.

I'll be convinced that intervention is necessary when I see people getting raped by credit cards to pay for food - as opposed to the 50 inch LCD TV or the Pucci/Gucci dress.

I actually think the economic education process is going backwards: I've recently seen a columnist on TheStreet.com who is going 'counter-wisdom' and telling young people to spend because their savings don't matter.

It is amazing why no one talks about the rule of 72 and what it means for a young person:

Interest rate or investment gain as a whole number (i.e. 5% = 5) divided into 72 equals the number of years for a given investment to double.

Therefore given that on average people work 40 years, 40 divided by the result of the above = the number of times your investment will double in your lifetime.

Thus a 7.2% interest/gain means 4 doubles, or in other words $1 saved at 25 years old = $2 saved at 35, $4 saved at 45, and $8 saved at 55 and equals $16 saved at 65.

Therefore $100 saved a month at 25 is equivalent to $800 saved at 55. This does matter.

Only if interest rates/gains are very low does it 'not matter'.

Cramer's nephew should be shot as a populist chip of the old block.

[necron99]

I totally agree with the worry about splitting our paycheck in half between loan repayment and taxes, just to live... call me prescient, or maybe not (no more than your average iTulip member), but in 1996, under the previous administration, I thought this was all pretty obvious. That year I wrote a fiction piece, under an alias, which I think might lend a first-person perspective to living under a runaway FIRE economy... (Adobe PDF file)

http://www.processedworld.com/Issues...y_a_Winner.pdf

Speak of the devil; here was his credit card bill. As usual, he signed over his RatScan paycheck to ViMaCard and sealed the envelope. As usual, he purchased another four weeks of freedom, while adding another handful of pebbles to the landslide of debt waiting to devour him in the future.

[...snip...]

He uplinked to Leebay's website, ignoring the obligatory random advertisement virus:

"STARVING?? AMERICORP-BANK wants to help YOU!! You'll love our great rates on food and clothing loans."

That would probably be more appropriate under Part II of this article, but I've been too lazy to purchase iTulip Select, so I can't comment there...

[c1ue]

Pretty good story.

I would like to have seen some historical/economic background though - just a couple of sentences a la Piper.

The Negative Checkoff thing - classic!

[Lukester]

Necron99 -

Great read. Reminds me very much of the satirical writing of the British Sci Fi author John Brunner (The Jagged Orbit, Stand on Zanzibar, The Sheep Look Up) from the early 1970's. Not well known but very competent, humorous yet acerbic, tautly woven and masterful within that genre. His character sketches are extremely rich and carefully drawn, verging on kaleidoscopic casts of characters (heavily ironic and very funny) within a Sci Fi genre where genuine caustic humor is a great rarity.

Your style is a close match for his. Needless to say his writing from 35+ years ago is not dated in the least - it perfectly anticipates the dystopia you also describe. Unfortunately much of his work is out of print but you can still pick easily up the above novels on Amazon used. If you still write or read this genre, he's the best of the lot.

http://www.sfreviews.net/jaggedorbit.html

http://www.eyrie.org/~eagle/reviews/...798-836-1.html


Your own vision of our near future is tautly written and very entertertaining! Needless to say it is also profoundly depressing, which you'll doubtless accept as a great compliment!

[necron99]

Lukester, I am very grateful for the reply, as I like to read this stuff -- and you're right, I take that as a compliment! I have an as-yet-unpublished 'thematic sequel' -- doesn't involve the same characters, but is set in the same milleu -- so if anyone can promise me a lucrative book deal with movie options, PM me for the sequel!

[jk]

Necron99 -

Great read. Reminds me very much of the satirical writing of the British Sci Fi author John Brunner (The Jagged Orbit, Stand on Zanzibar, The Sheep Look Up) from the early 1970's. Not well known but very competent, humorous yet acerbic, tautly woven and masterful within that genre. His character sketches are extremely rich and carefully drawn, verging on kaleidoscopic casts of characters (heavily ironic and very funny) within a Sci Fi genre where genuine caustic humor is a great rarity.

Your style is a close match for his. Needless to say his writing from 35+ years ago is not dated in the least - it perfectly anticipates the dystopia you also describe. Unfortunately much of his work is out of print but you can still pick easily up the above novels on Amazon used. If you still write or read this genre, he's the best of the lot.

http://www.sfreviews.net/jaggedorbit.html

http://www.eyrie.org/~eagle/reviews/books/1-85798-836-1.html

shockwave rider

[goprisko]

Gentlemen:

Back in the good old days.... before banks had computers, that is.....

Banks operated on a 3% spread. Savings accounts paid 5%.

There were no fees...

Banks had tellers.....

Banks made money.


So, I don't think you have gone far enough... we need to return to a strict interpretation of Glass-Stegal, with a twist....

Bank holding companies are abolished. banks cannot own other businesses, and cannot be owned by other businesses, period.

banks larger than 10 Billion must pay 2% above the discount rate to use the window and operate on a 1% spread .....

banks between 1 billion and 10 billion 1.5% above the discount rate and 1.5% spread.....

banks between 500 million and 1 billion on a 1% above the discount rate and 2% spread....

banks smaller than 500 million at the discount rate and on a 3% spread.......

Savings and Loans at 0.5% below the discount rate and on a 3.5% spread.....

Credit Unions on 1% below the discount rate and on a 4% spread.

Derivatives on financial instruments, including securities of any kind are only tradeable on an open outcry system.
Derivatives of any kind must meet margin requirements established by the SEC/FED.
Derivatives of all kinds must be settlable via delivery not in cash. Which means the end of tranches slashes and any kind of exotic manufactured security.
Derivatives must be marked to market daily, and if no trades occur, commodity rules apply with daily limits and limit down days possible.

Derivatives cannot be used as collateral for borrowing anything.

All trades must be entered by hand, computerized trading is prohibited. Orders for traders with networths less than 1 million are executed first.

Banks cannot trade or originate Derivatives of any kind.

Rating institutions cannot own anyone, cannot be owned by anyone, must be independent.

Brokerage houses cannot trade derivatives, only shares, cannot be owned by anyone, cannot own anyone.

Commodity houses cannot trade shares, only futures contracts, cannot be owned by anyone, cannot own anyone.

Insurance Companies cannot perform any other function except write insurance, including no pension fund mgmt, no mutual funds, no money market funds.... etc. Expressly, cannot own banks, brokerages, commodity traders, rating agencies, savings and loans, and credit unions.

Mutual or Hedge or commodity Funds cannot be owned by Brokerages, Commodity Brokers, Banks, Insurance Companies, etc.

Funds must meet margin requirements which are twice as high as those for individual investors, are regulated by the SEC/FED

Credit Cards cannot charge more than twice the discount rate.

Everyone is eligible for a bank account. ( free )

Everyone is paid via direct deposit to their bank account.( no check cashing scams )
The IRS rules are changed to provide a guaranteed minimum income, which depends upon life time earnings.
The US adopts a single payer medical system.
Bankruptcy is returned to easier rules.
Credit rating agencies and credit scoring systems are abolished. Banks must do due diligence before offering credit. Same for credit cards.

INDY

[FRED]

Gentlemen:

Back in the good old days.... before banks had computers, that is.....

Banks operated on a 3% spread. Savings accounts paid 5%.

There were no fees...

Banks had tellers.....

Banks made money.


So, I don't think you have gone far enough... we need to return to a strict interpretation of Glass-Stegal, with a twist....

Bank holding companies are abolished. banks cannot own other businesses, and cannot be owned by other businesses, period.

banks larger than 10 Billion must pay 2% above the discount rate to use the window and operate on a 1% spread .....

banks between 1 billion and 10 billion 1.5% above the discount rate and 1.5% spread.....

banks between 500 million and 1 billion on a 1% above the discount rate and 2% spread....

banks smaller than 500 million at the discount rate and on a 3% spread.......

Savings and Loans at 0.5% below the discount rate and on a 3.5% spread.....

Credit Unions on 1% below the discount rate and on a 4% spread.

Derivatives on financial instruments, including securities of any kind are only tradeable on an open outcry system.
Derivatives of any kind must meet margin requirements established by the SEC/FED.
Derivatives of all kinds must be settlable via delivery not in cash. Which means the end of tranches slashes and any kind of exotic manufactured security.
Derivatives must be marked to market daily, and if no trades occur, commodity rules apply with daily limits and limit down days possible.

Derivatives cannot be used as collateral for borrowing anything.

All trades must be entered by hand, computerized trading is prohibited. Orders for traders with networths less than 1 million are executed first.

Banks cannot trade or originate Derivatives of any kind.

Rating institutions cannot own anyone, cannot be owned by anyone, must be independent.

Brokerage houses cannot trade derivatives, only shares, cannot be owned by anyone, cannot own anyone.

Commodity houses cannot trade shares, only futures contracts, cannot be owned by anyone, cannot own anyone.

Insurance Companies cannot perform any other function except write insurance, including no pension fund mgmt, no mutual funds, no money market funds.... etc. Expressly, cannot own banks, brokerages, commodity traders, rating agencies, savings and loans, and credit unions.

Mutual or Hedge or commodity Funds cannot be owned by Brokerages, Commodity Brokers, Banks, Insurance Companies, etc.

Funds must meet margin requirements which are twice as high as those for individual investors, are regulated by the SEC/FED

Credit Cards cannot charge more than twice the discount rate.

Everyone is eligible for a bank account. ( free )

Everyone is paid via direct deposit to their bank account.( no check cashing scams )
The IRS rules are changed to provide a guaranteed minimum income, which depends upon life time earnings.
The US adopts a single payer medical system.
Bankruptcy is returned to easier rules.
Credit rating agencies and credit scoring systems are abolished. Banks must do due diligence before offering credit. Same for credit cards.

INDY

Now there's a well thought out and comprehensive piece of banking reform.

Let's work on getting that in front of Hudson, Paul, and Kevin Philips to see what they think.