Clinton: I Was Wrong to Listen to Wrong Advice Against Regulating Derivatives*

I am glad that Clinton can see where his administration went wrong. And that he is man enough to admit it.
I just don’t understand how anyone could have thought that the Glass-Steagall Act had out-lived its usefulness.
One problem is that those financial experts that advise every president seem to have come up through the ranks of banking. They are totally devoted to the idea of profits and taking risks to make profits. The idea that the entire economy hinges on banking seems to take a back seat to profits.

Follow-up question, sir: You deregulated the financial industry at the end of your presidency while the Bush/Gore election was still being contested, and with Obama’s coach Larry Summers leaning into your ear.
How many millions of dollars do you estimate your Library received in donations by hedge funds and other financial players in response to that signing?
What would make us think that same deep financial croneyism isn’t continuing through the Obama administration with Summers, Geithner and Rahm Emanuel (who recieved more hedge fund donations in his 2006 run than any candidate evahhhh)working the ropes?
Republicans?! Ptewy! Those guys are pikers compared to you thugs.

Brooksley Born. Brooksley Born was in the Clinton administration, she tried to regulate derivatives and Greenspan and Summers ran her out of town on a rail after embarrassing her on Capitol Hill. Everything she said would happen, did. Everything she warned against came to fruition. Everything Greenspan and Summers said she was lying about was the truth. It all could have been avoided and it was all on Clinton’s watch.

“And the flaw in that argument,” Clinton added, “was that first of all sometimes people with a lot of money make stupid decisions and make it without transparency.”
The former President also said he was also wrong about understanding the consequences if the derivatives market tanked. “The most important flaw was even if less than 1 percent of the total investment community is involved in derivative exchanges, so much money was involved that if they went bad, they could affect a 100 percent of the investments, and indeed a 100 percent of the citizens in countries, not investors, and I was wrong about that.”
Clinton also blamed the Bush administration for scaling back on policing the financial industry. “I think what happened was the SEC and the whole regulatory apparatus after I left office was just let go.”
Much of the financial carnage of the past several years, Clinton said, could have been prevented if only his appointed regulator had been kept on after he left office.. “I think if Arthur Levitt had been on the job at the SEC, my last SEC commissioner, an enormous percentage of what we’ve been through in the last eight or nine years would not have happened.”
Clinton said he regretted not trying to regulate derivatives, but that Republicans would have stood in the way. “Now, I think if I had tried to regulate them because the Republicans were the majority in the Congress, they would have stopped it. But I wish I should have been caught trying. I mean, that was a mistake I made.”

No deep rants from me, but just few cultural questions.
1) where is Brooksley Born and why isn’t an American desire to have honest public officials obvious enough?
2) why are Summers and Rubin still making any decisions and ‘advising’? please note I am not asking they be held responsible for the frivolities, that’s too much.
3) why is the current President relying on them? (plus Geithner of course)

CAROL: “Clinton throws former advisors under the bus. Film at 11.”
Clinton also said HE was wrong, too. Wrong for taking the advice and wrong for believing it would work. You need to learn the definition of throwing someone “under the bus.”

Bush never did anything wrong, ever. His bywords: “don’t apologize, don’t explain.
Same as expressed to me by the ex-vice chairman of JPM. – who also told me, “we can do what we want. we have the money, we have the power.”

For LJK
The correct spelling of the greek word you used is
HUBRIS.
It’s a good word, so you might as well spell it right.
Best wishesl, BG

10 years too late, and some of the same guys are advising Obama!
While your at it Bill, how about those WMDs your administration claimed Hussein had?

Clinton will always be remembered as a great President, he has several times admitted when he was wrong. I have never heard or read anywhere where Bush has admitted being wrong about anything or take responsibility for anything that happened while he was President. Bush along with the Republicans ran our Country into the ground and made all the money they could get on the backs of all of us and none of them have ever apologized or taken responsibility for any of it.
Now all the problems we have are considered by the Republicians to be Obama and the Democrats fault they still will not admit that it all started before Obama took office. He has been trying his best to get our Country back on it’s feet and jump start our economy. It will take us a while to recover from this and I just hope we all learn from this lesson this time so we don’t commit this same mistake again..

Janey, YOU NAILED IT! WELL SAID! You save me the typing.

Larry Summers ignored Brooksley Born in the 1990s, telling her regulating derivatives would DESTROY the economy.
He left the government payroll for, what about 18 months, to go to Harvard (where he told women they weren’t any good at math and science)—and during his short tenure, he LOST $1.8 BILLION of the Harvard endowment.
THEN Obama, for some inexplicable reason (and whom I voted for) HIRED him as an ECONOMIC ADVISOR.
Larry Summers is economic ebola. Too bad, like the virus, he doesn’t DIE OFF in about 10 days, but lives on to destroy everything in his path with his arrogance and stupidity (a really bad combination).
Nice goin’, Lar!

This is undoubtedly brought up due to the frontline piece about how one lone women tried to regulate the derivatives market under clinton’s watch but summners, greenspan and co stopped here and her agency dead in it’s tracks. They claim to follow free market enterprise as an ideal only but only practice it on the upside. But to be follow capitolism to a tee they must have allowed these banks to fail without bailouts. What they did was try an economy loosely based on capitalism and look where it got us.

BRAVO to President Clinton for his insight. Bush will never admit a mistake or reflect intelligently on matters of such grave national interests with severe international repercursion. Our deficits are almost always accumulated by Republican administrations–and they want to get back to do the same thing again. Why are people so gullible as to listen to these folks after what they did to our economy? They are good at propaganda and at taking things by violence and force–note how they took the Presidency in 2000 as one the most striking example. They are trying the same again and trying to intimidate and misinform us all. Where is the silent majority?

Thank you, President Clinton, for acknowledging your part in the breakdown of oversight of the sale of derivatives. Although your participation in the fiasco that ensued was slight compared to Bush’s, your retrospective analysis is appreciated. And you’re right; the GOP would have shot down any effort on your part to regulate.
It’s hard for us humans to know where to place the real blame – so many hands are dirty, so many lies have been told, and so much money has changed hands all around. God knows, tho, and those who enriched themselves by gorging at the trough will pay dearly one day, maybe here on earth, but sure in the afterlife…

The derivatives market was established the last couple of years Clinton was in office and was just a fraction of what it is now. They just didn’t see it as being a huge factor but as a way for some investors to manage risk. The problem was it was totally unregulated and during the Bush years it ballooned to around $60 trillion with banks pushing derivatives to collect the fees thinking they would never have to make any pay outs. Most CDSs covered mortgage securities and those securities were supposedly triple A. Lack of oversight and regulation during the Bush years was the real culprit, not that the market for these instruments was initiated during the Clinton administration.

Rubin and Summers were Goldman Sachs guys. Enough said….

I don’t understand the economics (along with 95% of Americans) but I do understand the politics (along with 95% of Americans) and the politics are that Clinton’s barking presages Obama’s biting!
It’s always that way with dogs!

Good for Bill Clinton. He admitted he was wrong taking Ritzy Rubin’s and Fat Larry’s advice but exposed Rubin and summers for what and who they are…..corrupt, incompetent, unAmerican crooks

Clinton: I Was Wrong to Listen to Wrong Advice Against Regulating Derivatives*…………. Were you wrong to fail to accept the Sudan’s offer to extradite Bin Laden ? Would 9-11 ever had occurred had you accepted this offer? Were you wrong to put pressure on ABC via your surrogates Richard Ben-Veniste and John Podesta to remove incriminating portrayal of your role in the “The Path to 9/11″. While you admitted the Sudan’s offer in a speech in 2002,in typical cowardly Clintonesque fashion, you subsequently stated to Christiane Amanpour “What I said was wrong”. Sir, were you wrong about your role in 9/11, as well as regulating derivatives? Sir, your legacy at some point will accurately reflect the damage you are responsible for, the truth cannot be suppressed forever. Sir, Abraham Lincoln said it better than I am able; “Nearly all men can stand adversity, but if you want to test a man’s character, give him power.”

mmm312 is right.
Summers, Rubin and Greenspan pushed Brooksley Born out of the Commodities Futures Trading Commission when she tried to push regulation of derivatives. Look up an episode of “Frontline” on PBS on the subject.
Obama should now see that he should clean house and get rid of Summers, Geithner, and any that were closely involved with Wall Streets dealings.
I am sure there are plenty of what Harry Marcopolos (Bernard Goldberg whistleblower) would call “gray hairs” or “no hairs” that would advise Obama for free.

Did anyone ever ask a simple question: what useful end does derivative trading accomplish? Selling bundled mortgages does NOT make more $$ available for lending, it does NOT capitalize companies and lead to economic growth or the betterment of society. Derivative trading makes $$ for the traders and has no worth societal worth than Texas Hold ‘em.
And since it serves no purpose except creating a new form of gambling – why allow it at all?

I hope Jake Tapper goes far at ABC. Hopefully Jake will set a trend of fact checking and calling BOTH parties out when they lie. Thanks Jake for being a true journalist.

The significant point is that W. didn’t know what a derivative was. We need smart presidents like Bill Clinton and Barack Obama.

Robert Rubin and Larry Summers. Great pair. Summers was so incompetent, the faculty at Harvard booted him from running the University. And Obama picks him to be Director of the White House’s National Economic Council. Robert Rubin was so incompetent running Citigroup, they booted him as well. Wouldn’t it be nice to have any Administration pick people who are competent for once?

He probably regrets NAFTA too.

Hey Obama! I have an idea. Let’s spend more tax money!

Yeah…Rubin and Summers…what a pair….check your paper money. Rubin signed it during Clinton.

The “newsmax” report that is parroted here has been completely debunked, more than once, including by Bush’s 911 commission.
It is an attempt, in almost soviet style, do falsely discredit a previous ruler.
It is a lie.
Those who repeat it are responsible for spreading lies.
If newsmax reported tomorrow that Bill Clinton is responsible for the Icelandic volcano posters here would presumably parrot this too.
Pathetic and deeply irresponsible.

I really miss President Clinton. No one is perfect, but I really MISS President Clinton!

I don’t miss him at all! Except he’s a tad less pathologically narcissistic than Obama….

So what sort of headaches does this create for the sitting president? Summer and Rubin are top Obama advisers, and Clinton just called them incompetent – and complicit – when it comes to the issue that nearly destroyed the economy two years ago. Yikes…

Bobdevo Apr 18, 2010 8:17:42 AM states …..”Did anyone ever ask a simple question: what useful end does derivative trading accomplish? Selling bundled mortgages does NOT make more $$ available for lending, it does NOT capitalize companies and lead to economic growth or the betterment of society. Derivative trading makes $$ for the traders and has no worth societal worth than Texas Hold ‘em.”
Robson concurs and says. One could say the same thing about financial services and Wall Street in general. Instead of serving a primary function of capitalizing productive companies, it has become a rigged casino club intended to enrich only the house.

What about Whitewater? Did you make that decision based on flawed advice?
A con-man would know when he’s being conned. This was more of a case of one con-man helping a group of con-men pull off their scam.

He was also wrong to direct Andrew Cuomo to insert Fannie and Freddie into the subprime market.
And to allow Cuomo to sue Accunbanc for financial discrimination.
But then, that wouldn’t have made millions for Jamie Gorelick and Penny Pritzker.
But the credit crisis wouldn’t have happened.

The alternative to not using complex credit instruments is returning to the days of 5-yr, 50%-down mortgages and very few people owning their own homes. And, if not for the last-minute switch to direct lending, 90 percent of colleges would have folded over the next year due to the lack of availability of capital to the lenders who made the student loans.

Worst mea culpa….evah.

Phi Gramm headed the senate banking committee under Clinton, and it was he who gutted the SEC funding and forced Arthur Levitt out. Levitt was told to forget regulating derivatives or else. This is the same Republican Gramm who together with his wife, was responsible for the collapse of Enron when he snuck through legislation deregulating energy futures and commodities.The same Gramm that was John McCain’s financial advisor during his presidential campaign. I can’t even fathom this nation’s state of affairs had MCain and his idiotic pick, Sarah Palin, won the election.

Right now hundreds of institutions of higher education are training tens of thousands of students to be psychologists and psychiatrists. Obviously, they are being trained with full faith that mental illness of all kinds will continue well into the future. No one expects there will not be a market for their services. There ain’t no cure for what ails us. Crisis after crisis in all disciplines are just variations on a theme. Too much imagination being driven by too much ambition. The type A personalities will continue to screw around in the top echelons of banking, business, military, politics, etc and invent complexity and scarcity so they can prosper greatly under the guise of saving the rest of us. “They are all ambitious men” Trees don’t grow to the sky. The institutional playgrounds have become top heavy and the laws of physics predict there outcome. Afraid Marx was right about what is inevitable. This whole master/servant culture has gone as far as it can go. Educate enough people to be lawyers and they need us to all take sides. And yet there is no money to fix the streets. Get it?

The arrogance of power displayed by Phil Gramm (Mr. Stop Whinning) was a major factor in the entire meltdown of 2008. When one vocal conservative fanatic can affect the lives of billions (worldwide)and then rail against the American people, you know something stinks to the core in our financial systems.

Failure to reign in and regulate derivatives will result in the same exact economic situation we are now in….except much worse….5-10 years down the road. PERIOD.

“The money they’re putting up guarantees them transparency.”
Clinton forgot to mention the money put up to buy and sell derivatives was either other people’s money (investors) or not real money (backed by bad loans). If the bankers were personally financially responsible for their decisions maybe they would have looked a bit more carefully at the junk they were peddling.

Has Bubba yet made his mea culpas for NAFTA? If so, I seem to have missed them.

‘Sick Willie’ would have had to ask a
few questions. That’s all. He must be
dumber than advertised. Or another blame
someone else.

What? Clinton is such a phony baloney. This guy agreed to rescind the
Glass-Stegal Act. If you believe this bunch of BS, I got some Leman Brothers derivatives to sell to you.

We should thank former Senator Phil Gramm for the Gramm-Leach-Bliley Act: allowing commercial banks, investment banks, and insurers to merge and for clandestinely slipping a 262-page amendment into the omnibus appropriations bill titled: Commodity Futures Modernization Act. The essence of the act was the deregulation of derivatives trading.

Didn’t Clinton repeal Glass-Steagal? Wasn’t it Rep.Barney Frank, a Democrat, and Sen. Christopher Dodd, also a Democrat, who loosened the Wall Street Rules. And wasn’t it Frank again who insisted that banks make loans under the guise of “Community Reinvestment” which put so many mortgages out there to people who could not pay them? Bill Clinton is looking us right in the eye once again and saying, “No, I didn’t steal your ball, while it is in his hands” He is a pathological liar who could not tell the truth if it were printed on a cue card in front of him.

Bill seems to forget that he also allowed American jobs to disappear in his free trade quest with his conservative pals.What did Bill think would happen when multi millionaires used to getting their way would start using sophisticated financial devices? This is his way of trying to weasel out of responsibility.

Mr. Clinton was just wrong.
He claims credit for budget surplus that was produced by Republicans while thy were still new and honest. That is just plain not honest.
Mr. Clinton was an embarrassment to the office of the President.
How many Serbs died to keep the headlines off his impeachment trial?
No one has made more cynical use of the U.S. Military.
Let’s hope Mr. Obama does not opt for the same in 2012.

While each blames the other, both parties are equally to blame. Also, people who knew they could never afford to pay for a home and bought one anyhow are to blame. People with homes well on the way to being paid for and who refinanced for the extra cash and put themselves upside down are to blame. Greedy mortgage brokers and greedy bankers and greedy bond raters are to blame. It will take a generation, if then, to work ourselves out of this hole.

At least Clinton can admit he made a few mistakes, which we have yet to hear the GOP take any responsibility whatsoever for the 6yrs they had control. They blame the Congressional Democrats who had no power with Bush… and of course they blame President Obama…

Same Prez who in 1999 signed the Gramm bill which did away with Glass/Stegall. Now the Dems are clamoring for a return to Glass/Stegall type regulation. Clinton did not understand derivatives nor did he understand regulation reform. Now, the Dems are once again wanting to reform what they reformed once before. Yes, indeed, me and my money feel very secure.

Bill Clinton PARDONED Terrorists in 2001 who did not want to even be pardoned and who still vowed violence. The Puerto Rican FALN Terrorists in prison in New York were pardoned by Bill Clinton so that the Puerto Rican community in New York would vote for Hillary Clinton as Senator. These terrorists “never asked” for a pardon, by Clinton and his Asst. Attorney General Eric Holder proposed pardoning these idiots. So who is for Domestic Terrorism? Why would Clinton let these terrorist go? Clinton should just shut the hell up and go away..he was a moron who disgraced the presidency.

Shocking. The President listened to his advisors instead of telling them how to handle derivatives. A smart president can actually explain the pros and cons of that decision. People come in here with their political agenda to bash the guy. I’m just greatful that I get some real journalism here. At least the guy can admit mistakes. I would like a followup with his advisors and people responsible for the SEC as well.
Beats a mindless conversation from propagandist A vs B.

Will President Clinton admit that he was wrong when when he decided to allow gang stalkeing groups to poison and irrradiate people without fear of prosecution?

Will President Clinton admit that he was wrong when when he decided to allow gang stalkeing groups to poison and irrradiate people without fear of prosecution?
Posted by: DamaskinosWasRight | Apr 19, 2010 4:09:54 PM
_________________________
What are you talking about??? Can you fill me in?

Clinton still gets one thing wrong. It never mattered that the average investor does not purchase derivatives. Credit default swaps affected the average person who never bought them, never saw them and never heard of them. CDS created a market in bad mortgages, encouraging lenders to make them and make them quickly, because even the worst loans were profitable and in some cases the worst loans were more profitable than the good ones.

A grayer, but no less slick Willy.

It is amazing to me that because he signed an Omnibus bill, that he worked hard for, he takes the balme for what Phil Gramm did and doesn’t even mention Gramm! Phil Gramm wrote that bill. Who do you think better understands it… a republican who wrote it or a President in the (literally) last week of his Presidency who relied on advisors to explain what in reality is not complex at all. Phil Gramm also wrote the Gramm, Leach Bliley Act which tore down the walls between banking and investment houses. Was Clinton responsible for that too? Please check whose fingerprints are all over every piece of legislation that deregulated Wall Street. You will find Phil Gramm’s fingerprints on every single bill. He systematically tore our economic underpinnings apart. If you are going to do this article, could you at least ask Clinton if he would have ever heard of anything in this bill, if it were not for the authors?

Clinton should have vetoed the repeal of Glass Stegall whether the lines were being blurred or not. Rubin, Summers, Greenspan, Gramm, Dodd and Frank will go down in history as the stupidest most self serving F ups in American history. Clinton can blame lack of SEC enforcement, but without Glass Steagall no one could stop the banks and brokers. Now the Obama administration has done nothing to get the wall street crooks and the people have become even more cynical about Congress being in the pockets of the banks and brokers. That is sewing the seeds of discontent which could change this country forever. Time to vote the crooks in Congress out.