Why should they repeall theDodd -Frank Act? (healthcare, Obama, cost)
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Simple. The Dodd-Frank act says that any bank that the government deems to be in danger of collapse due to risky loans can be taken over and given to a larger bank. With such a heavy sword dangling over their heads the people running those banks are reluctant to make ANY loans for fear some burecrat will deem them 'risky' and come in and take their bank. It stifles small banls' ability to make loans and it rewards the large banks (that are in Obama's pocket to a large degree) by allowing them to gobble up small banks for pennies on the dollar when the government gives them the green light.
Last edited by rogerbacon; 10-13-2011 at 02:37 PM..
In the new Repub jobs bill they want to repeal the Dodd-Frank Act.
How come?
Dodd-Frank imposes costs on banks.
Republicans, more than anyone else, don't want to upset the bankers. They are busy finding ways to blame the crisis on Democrats, and Dodd-Frank is an easy target.
Now, like the Healthcare bill, Dodd-Frank is a huge bureaucratic mess. That's a fair criticism. However, just like the healthcare bill, the Republican alternative is much worse.
They should repeal Frank Dodd and replace with MUCH MORE stringent regulation, ya know, like bringing back Glass Steagall. Killing off Glass Steagall in the late 90s and 2000 will go down as one of the most colossal mistakes in US history.
They should repeal Frank Dodd and replace with MUCH MORE stringent regulation, ya know, like bringing back Glass Steagall. Killing off Glass Steagall in the late 90s and 2000 will go down as one of the most colossal mistakes in US history.
It pretty much is back, banks can't do prop trading.
It pretty much is back, banks can't do prop trading.
...and a LOT more. This two-thousand-page monstrosity has outrageous costs and provisions that will be a heavy burden on ALL 7,000 banks in this country, including the one in your town, and their customers.
For example, a business has a $30,000 line of credit secured by a $90,000 building, reviewed and renewed annually. While in the past, the loan officer's direct personal knowledge of the adequacy of the collateral was good enough (since the building is across the parking lot from the bank), Dodd Frank requires a fresh appraisal every year at a cost to the borrower of $400-$700 annually. Additionally, the bank must have on staff an officer in charge of appraising the appraisers and the appraisals. (My bank has not yet figured out how it is going to charge this to the borrowers.) And that officer must NOT be connected to the lending function--just new, unproductive staff.
So what will the bank and their customer do in this case? Renew the loan UNSECURED, drop the collateral requirement. The borrower is solid, no doubt about repayment--but Dodd Frank is weakening banks instead of strengthening them. And the little guy just starting out or lacking assets will not get this kind of treatment.
This is one small example, one tiny corner of this mess--and it is way past stupid. Community banks by the thousands will give up and sell out to the big chain banks within a few years, unless it is repealed.
If you don't believe me, ask your local banker. And if you stand up for the screwing of seven thousands banks because two or five or a dozen are bad actors, you are tyrannical.
Because the government should stand by idly while banks continue to fleece the populace. The only time the goverment should get involved is to bail out banks when they implode from their own greed.
...and a LOT more. This two-thousand-page monstrosity has outrageous costs and provisions that will be a heavy burden on ALL 7,000 banks in this country, including the one in your town, and their customers.
For example, a business has a $30,000 line of credit secured by a $90,000 building, reviewed and renewed annually. While in the past, the loan officer's direct personal knowledge of the adequacy of the collateral was good enough (since the building is across the parking lot from the bank), Dodd Frank requires a fresh appraisal every year at a cost to the borrower of $400-$700 annually. Additionally, the bank must have on staff an officer in charge of appraising the appraisers and the appraisals. (My bank has not yet figured out how it is going to charge this to the borrowers.) And that officer must NOT be connected to the lending function--just new, unproductive staff.
So what will the bank and their customer do in this case? Renew the loan UNSECURED, drop the collateral requirement. The borrower is solid, no doubt about repayment--but Dodd Frank is weakening banks instead of strengthening them. And the little guy just starting out or lacking assets will not get this kind of treatment.
This is one small example, one tiny corner of this mess--and it is way past stupid. Community banks by the thousands will give up and sell out to the big chain banks within a few years, unless it is repealed.
If you don't believe me, ask your local banker. And if you stand up for the screwing of seven thousands banks because two or five or a dozen are bad actors, you are tyrannical.
Interesting information. More unintended consequences from the fools in Washington.
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