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Gold/Mining/Energy : Big Dog's Boom Boom Room -- Ignore unavailable to you. Want to Upgrade?

To: not_prudent who wrote (134287)	6/9/2010 10:24:22 AM
From: ChanceIs	1 Recommendation Read Replies (1) \| Respond to of 206223

>>>The idea of being selectively for big government is a big cause of big government.<<< I have to agree. But you must admit that the ratings of securities matter is a mountain of a problem. Who pays for it? If he who would like to be rated pays, then there is an obvious conflict of interest. If he would invest pays, then he might be disappointed with the results - spent a lot of money only to find that the corporation in which he had invested is really after all only CCC. Chicken and egg. How do small start-ups get the recognition they deserve? The last few financial conferences featured "skin-in-the-game" as the phrase du-jour. Much criticism has been offered of the mortgage industry in its "issue to distribute" business model. He who issued had all the motivation to make a bad load to get the fee , and then pass it off to the suckers at Fannie/Freddie or elsewhere. I think that we may go to a mode wherein the issuer has to keep half of the loan on its own books. If you have to keep the thing be exposed to a loss, you wouldn't want to be creating instruments rotten from the get-go. How does that apply to the current oil spill disaster??? A little hard to say. Much blame has been deposited at the door of MMS....regulatory capture, free baseball tickets, dinners, etc, etc, etc. How do you get BP not to take excessive risks? The fine mechanism already had caps which encouraged risk by limiting the penalty. These caps will be raised 10X if they haven't been already or even ex-post-facto. Maybe you require them to take out huge amounts of insurance. Then the insurance company would be all over them to behave. The current treatment of the TBTF banks is to establish a big slush fund - paid in advance - to bail them out the next time they take too much risk. That way they are encouraged to take too much risk because they know a-prioi that they will be bailed out. Yes, yes, there is some new special bankruptcy court for bank TBTFs. But who gets to pull the trigger on that? Probably that massive insurance requirement with three company agents on the rig deck 24/7 is worth a very serious look. The problem still remains for small businesses who want to get in the game. How do you get attention? Small business is where all of the growth lies. Perhaps that is why the the venture capital folks might do their own assessment - and keep the first born male. Let me put it another way. Instead of writing checks to all of these Green start-ups - such as the ethanol debacle - and mandating consumptions levels for the special agricultural interests, that money might be better spent on a pool of government workers tasked to evaluate the business prospects of these start-ups. The start-ups are too small to buy a lot of Congress folk. Might work and/or be a good use of taxpayers $$$$.