A frustrated bully lashes out. Barney Frank intrudes rationality to Obama's hysterics.

http://tinyurl.com/y99qj9l
Obama steps up campaign against Wall Street banks By JIM KUHNHENN, AP WASHINGTON – President Barack Obama stepped up his campaign against Wall Street on Thursday with a far-reaching proposal for tougher regulation of the biggest banks. "We have to get this done," Obama said at the White House. "If these folks want a fight, it's a fight I'm ready to have."
It was a stern, populist lecture from the president to Wall Street...Obama said the government should have the power to limit the size and complexity of large financial institutions as well as their ability to make high-risk trades..."We have to enact commonsense reforms that will protect American taxpayers and the American economy from future crises," Obama said. "For, while the financial system is far stronger today than it was one year ago, it's still operating under the same rules that led to its near-collapse."... Overhauling financial rules is the one issue on Obama's legislative agenda that appears still alive after Democrats' devastating loss Tuesday in the Massachusetts Senate race. The White House is renewing Obama's demand for an independent consumer financial protection agency as part of any overhaul. That's one of the major sticking points in the Senate; the House has passed its version already...****While there is much merit in these ideas, the timing and the across-the-board attack makes it clear that this is a political reaction to the repudiation Obama got in Massachusetts. This pretends that the Massachusetts vote was against Wall Street, rather than against Obama. Today's announcement is premature since it has insufficient details to be sure that it was carefully thought out. The major cause of the financial meltdown was not the banks ( AIG was not even a bank and would not have been affected by this proposal ) but, rather, the bad loans that banks were forced to make by Congress. The subsequent repackaging of the toxic paper by Wall Street was a secondary, rather than primary, cause of the problems. Saying banks would no longer be "allowed" to trade for their own accounts, sponsor hedge funds, etc. begs the question as to whether bank holding companies provide sufficient distance. Otherwise, it would provide some return to Glass-Steagall. In any case, Obama will only break up American banks and set the table for large, integrated foreign banks to come in to eat their lunch and put the system at the same risk. Better is just to throw out the idea of "too big to fail." The fact that there are already rules limiting the possibility of using deposits for banks other affiliate activity makes it clear that this is probably a political, rather than substantive, proposal. The claimed goal is to enhance lending to small business but the logic is unclear of how breaking up big banks will further this.****
http://tinyurl.com/yckewxf
Mean Street: Obama is Killing America by Killing Wall Street What has become of America? by Evan Newmark
Today, Goldman Sachs CEO Lloyd Blankfein announced record annual profits of $13.4 billion for his bank.He has repaid the U.S. taxpayer $11.42 billion for taking TARP money he didn’t want.He will contribute another $6.4 billion in taxes to the general public.And within weeks, if President Obama gets his way, Blankfein has a good shot at becoming the most hated man in our nation.
Apparently, this is now how we treat success in America. We damn it, and then we punish it by enacting loopy, politically expedient measures such as caps on Wall Street trading and principal investments. Why is our country so self-destructive? We need people to come together, but we engage in populist divisiveness. We need millions of jobs, but we kill the incentives and destroy the capital that will create them...
****Barney Frank, in an interview, intruded an element of rationality that rallied the markets by saying that "he" would require that any change take place over five years so that a fire sale of divestible assets would not occur. ****
http://tinyurl.com/y9rny5s
Kneale: Obama Loses It—the Bank-Bash Backlash
By: Dennis Kneale
The Democrat Debacle in Massachusetts offered a rare gift to President Obama: a premonition of the rout that was about to rack his own party in the mid-term congressional elections nine months from now....Instead, Bam is losing it. He is squandering this gift in favor of a damaging, intensified attack on big banks—the very engine of economic growth he needs to revive the economy and get himself re-elected....Real estate mogul Mort Zuckerman, an Obama supporter, said as much moments ago on Power Lunch, saying the President is “playing games with the financial system. . . It’s more about politics than policy.” In so doing, the President has shed his usual, becalmed visage of judicious intelligence and what-me-worry confidence. In its place is an unpleasant portrait of a sulking, vengeful politician lashing out at Goldman Sachs et al...and their brethren on Wall Street—the only target that, his polls say, might resonate with the voters who are forsaking him.
...Obama’s bank-bashing bent is an ominous sign that Rahm Emanuel and the politicos have taken over the White House, infecting sound economic policy with poll-motivated invective and restrictions that could thwart a strong rebound.Former Fed head Paul Volcker had prescribed this straitjacket months ago but got nowhere, as Treasury Secretary Tim Geithner and economic adviser Laurence Summers opposed the idea.Then the Democrats lost in Massachusetts on Tuesday, and suddenly the “Volcker Rule” is top priority...President Obama doesn’t care about any of this. He is down in the polls, he was humiliated in Massachusetts, and he’s trying to start a fight in an empty room to get himself out of this mess. Yesterday he declared that if Wall Street fat cats want a fight, he’s happy to give them one.But the better point was made on Power Lunch today by BB&T bank CEO Kelly King. He says he is surprised the President is “looking for a fight—we’re looking for consensus.”