The Solutions to the Global Financial Crisis

While the debate continues in Congress on reducing the budget deficit, the debt ceiling is about to revive. Because the dollar is still one of the reserve currencies of the world's largest deficits the U.S. budget and integrity of the Fed's balance sheet to contribute enormously to the debt burden in the world.

Here are some possible suggestions for reducing the deficit of the United States.

1) Audit the Federal Reserve.
Banks in the Federal Reserve System should be subject to annual audits, but the Federal Reserve itself has never had an independent auditor to examine its books. As the Fed expands its balance sheet, which serves more money in the global financial system, already overburdened with dollar-denominated securities and other debt instruments.

An interview of the Federal Congress of the Inspector General by Deputy Alan Grayson in 2010 showed that the Fed had no idea where 9 trillion dollars of money than had been created. This is clearly fiscal irresponsibility on a massive scale. The Federal Reserve requires annual audits to ensure financial integrity.

2) Consolidate federal regulators
Recent regulatory reforms of the United States financial and banking created a hodgepodge of new regulatory agencies, without clear distinction as to who does what? We need to streamline the federal regulatory process and create something powerful, clearly defined and organizations to extend their powers. Lax regulation created the subprime mortgage crisis, allowing banks to create fictitious mortgages and loans to unqualified people, so that taxpayers with the bill for irresponsible lending banks.

3) Remove the securitization
Securitization is the process of reorganization of the assets until the source of funding is no longer recognizable. It is, indeed, criminal activity, because the investor can not locate the real assets of the stage behind a security, the prevention of an investor to do your due diligence to determine if a title is worth the paper it is printed. The zoo confuse the values ​​of products, including CDOs and credit default swaps, led directly to the global financial crisis, the way that have not recovered.

4) Commercial Bank independent of investment banking
As permitted securitization, which should re-institute Glass Steagall, passed in 1930, after the Great Depression, and firmly separated commercial banks (traditional loan and savings) banks' securities (such as Goldman Sachs). The global financial crisis is directly derived from violations of the investment (securities) and the allocation of banks from traditional banks to create their own securities products.

We must repeal the Gramm-Leach-Bliley Act, passed in 1999, and the values ​​of so-called "reform" legislation introduced in the new millennium. that are primarily responsible for the excesses of banks.

As citizens, we must demand accountability of our financial and regulatory representatives in Congress, and to enforce banking regulations, or things are much worse!