FINANCIAL REFORM?

Maybe, maybe not. I was pleased to learn that Sen. Blanche Lincoln got her committee "to ban big Wall Street banks from trading in derivatives." but that doesn't seem to be enough. Gretchen Morgenstern points out "that neither the Senate nor House bills would chop down big banks to a more manageable and less threatening size. The bills also don’t eliminate the prospect of future bailouts of interconnected and powerful companies." Paul Krugman notes that "of AAA-rated subprime-mortgage-backed securities issued in 2006, 93 percent — 93 percent! — have now been downgraded to junk status." and nothing is being proposed which would effectively discipline the ratings agencies. Finally, as far as I know, no one has proposed an overhaul of the Financial Accounting Standards Board to prevent these kind of absurdities.