Regulatory Reform Needed

" Well in -- I would. But the talk about regulation because. I think. Bruce is right you have hundreds and hundreds of thousands of people working for the Securities and Exchange Commission working for the FTSE. The working for the comptroller of the currency the Office of Thrift Supervision. I mean huge bureaucracies but they were massively massively massively uncoordinated. And poorly motivated."

" Let's take some preventative medicine let's take some TARP money 800 billion -- 700 billion bucks."

" The lets kids people at the SEC bonuses a higher bonus -- if someone uncovers the next Bernie Madoff for someone. Stops the next Richard -- from becoming a monarch and and and on top of the you know huge domino risk let's keep some of the SEC. A higher bonus scale that we have to motivate. These these bureaucrats because really they were so asleep at switch and right now we're not on the only almost on the anniversary of 9/11 last week. And right before 9/11 what put our country at such terrible terrible danger. Was the same thing the FBI it was a really talking to the CIA the CIA was really coordinated with the alcohol tobacco and firearms people. And we have to have these bureaucracies better coordinator than SP a quarterback may be sad that."

" And it's interesting those loans to bring a focal point which is Bob they're fighting over who has. Discretion. Who has responsibility. As opposed to how long are we going to communicate to prevent the next crisis."

" Yeah pretty typical response on the part of bureaucracies to as soon as they paid you don't they start looking at the opportunity to exercise some power. In fighting breaks out between the agencies and within the agencies rather than trying to do anything. Really comprehensive and I think on some levels the efforts to try and reform whatever did take place I mean perhaps we don't need. A whole new spate of regulation we -- need to enforce the ones that are on the books in the ones. That are effective I do think there was a lack of will on the part of some of the the FCC. Bureaucrats that we're supposed to be watching this and you know in some -- I think the industry's response has been one of the most cynical things you can possibly see if you look for example. A very small sort of sort of corollary. With the credit card reform. We implemented some small measure of credit card reform what do credit card lenders do. They started ratcheting up all of their rates and started exercising their right there there abilities. To take anti consumer actions before those new regulations came in place that I think you can expect to see the same thing if somewhere down the road there -- the body of rules being written to re regulate the --"

" Assistant you know he's -- Bruce Lawrence Summers and Timothy Geithner had suggested that we could get regulatory reform this year even given the focus on health care reform. But what I look at where we are a year ago today the only thing at the time they did to try and stop the bleeding was they were preventing short selling. They need rules really challenging in terms of naked short selling what you actually have to make sure you go out and get a low -- before you short stock but. All other than some of that I am not sure what else we've discussed in terms of the issues like leverage. In terms of issues like exposure communication. I don't know how we have we been doing enough and what can that president thought parents say today. That suggests that we made enough progress."

" When you know. Like what you're saying -- as a student of financial history -- rent a lot about prior financial panics. And always wonder what it what it felt like to be and one well. That's what we've all lived through indeed September of 2008. Was a financial panic a storm a perfect storm has as Bob O'Brien said. And all this talk about more regulation and and whatever. You think about. Weekends where secretary Paulson Ben Bernanke Tim Geithner in less than two days. With senior executives were trying to remake the financial industry anybody thinks there's going to be good outcome from that. Is hallucinating. That's why I go back to the simplistic. Draw a line in this and consumers who put money at commercial bank need protection. Banks can generate decent returns good returns of their run well separate the risk taking. All this talk about derivatives innovation isn't going away Alexis it's what drives our markets. I just want to see. Investment banks in a place. Where if they fail they fail and I don't have to ante up as a taxpayer."

" All right we'll Bruce excellent points are we lost you there for the second at the end there. Laurence Bob unfortunately gentlemen we have to leave it there are a great conversation thank you guys."