Chancellor Merkel Just Did It in Germany, but We're Not Allowed To Do It Here!
May 21, 2010 (EIRNS)This release was issued today by the Lyndon LaRouche Political Action Committee (LPAC).
Acting after the close of the markets on Tuesday, May 18, in a sudden surprise move made on orders from the German government, Germany's financial regulatory agency Bafin banned certain derivatives trades for one year or longer. It banned naked short sales of Eurozone countries' bonds, naked credit default swaps (CDS) against those bonds, and naked short sales of the stocks of ten major German banks and insurance companies.
Speaking the next day in the German parliament, the Bundestag, Chancellor Angela Merkel said that she had been forced to act in this way against what she called "an existential threat to financial stability in Europe and even the world."
Merkel is right. As leading US economist Lyndon LaRouche said on Thursday, May 20,
But Barack Obama, acting through Senator Harry Reid, has refused even to allow a vote to restore enforceability to Title VII, governing derivatives, of the so-called Wall Street Reform Act. The discredited Senator Chris Dodd of Connecticut surreptitiously removed the enforceability of the regulations of Title VII, making them mere "suggestions" instead of "regulations," in the words of derivatives expert Michael Greenberger quoted in firedoglake. When Arkansas Sen. Blanche Lincoln, the author of Title VII, and Washington Sen. Maria Cantwell introduced an amendment to restore enforceability, Harry Reid refused to allow it to come to a vote.