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Obama could have changed this. It would have taken immense courage, but he could potentially have enacted provisions that would either have neutered Wall St, or - more subtly and most likely more effectively - moved the focus back to small business and direct community/government funding relationships, bypassing Wall St altogether, and then delivering a knock-out once the industry was marginalised.

Obama could have left Goldman Sachs to rot, and put the TARP money directly into the economy, or into smaller banks. It would have been dramatic, messy, risky and challenging, but it wouldn't have been impossible - even with a paid-for legislature.

EXACTLY! Had he started on Jan 21 and moved vigorously I doubt that the Dow would have dropped more than another thou below its March lows but GS, JPM, Citi, WF, BofA, AIG would be dismembered and the hit would have been to those who caused the mess, including foreign banks and the governments who indulged them by allowing CDSs on junk to suffice for reserve capital. Valuations of "assets" would have been marked to some believable reality, unpayable debt would have been written down and the basis for a real recovery would  be in place by now, whereas what we have now is a bogus recovery courtesy of the Fed, the Treasury and the regulators and the manipulation of markets by the TBTFs. It is great for the executives of the TBTFs but a disaster for everyone else.

Had Obama slaughtered the TBTFs he would be a folk hero of mythic porportions, would almost be assured increased majorities in the House and Senate and re-election in '12. By defending the status quo he is sinking in quicksand. He might not be looking to further his career, but he damn well better be concerned with his position in history. His only real accomplishments to date are to be the first black president, to insure the survival of a predatory financial sector for another year and to push through a revision of health care that is so flawed that it may further damage the economy.  

"It is not necessary to have hope in order to persevere."

by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Mon Dec 21st, 2009 at 11:14:24 AM EST
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