Wall Street Fix WishList

Forget all the spin being put forth by the media that this week's stock market selloff was due to the "tough" Wall Street reform measures soon to be enacted into law by Congress.

Hogwash! Wall Street has invested their money wisely into Congress and the so-called reforms amount to nothing. I won't bore you with the details, but if I had to rate the "reform" legislation coming out of Congress, where a 10 is tough and a 1 is soft, I would it a 0.5.

Put simply, it will be business as usual for "da boyz" and they will be able to continue doing as they please, including the raiding of the US taxpayers' piggy bank.

Here are few items on my "wish list" for Wall Street reform:

First, eliminate bank/investment firm lobbying in Washington. As it stands now, this Congress (both parties) is the "best" Congress Wall Street money can and does buy.

Second, turn the investment houses like Goldman Sachs from "banks" back into partnerships. These firms used to be partnerships where the partners all have unlimited personal liability for the losses. This would remove the "casino metality" from Wall Street, which is currently gambling with other people's (including taxpayers money).

Third, return to the specialist system. This would elimate much of the ultra-fast trading which occurs on Wall Street. This would bring back the human element and would help us avoid a meltdown caused by computer trading programs run amok.

Fourth, elimate the stock exchanges being for-profit. The exchanges have forgotten about the individual investor. Instead, they are chasing fees from high frequency traders and hedge funds.

Fifth and my favorite, FIX the financial media. Every day on Bubblevision (CNBC), one can see the same terrible, and dangerous to one's wealth, advice given out by the same old faces who have been wrong about the financial markets for years.

Yet, there is NEVER any mention of the pundit's terrible track record. All financial media should be required to disclose to the public the pundit's previous market forecasts, recommendations,and commentary.

Just once, I would like to see a Bubblevision host say to some pundit "Excuse me, Mr. Smith, but why should anyone listen to your recommendations when, if they followed your advice over the past 5 years, they would lost 25% of their money?"

I know - it will never happen - but this is a wishlist!

By the way, for those of you keeping score something remarkable happened in the first quarter of 2010. Four big banks - Bank of America, Citigroup, JPMorgan Chase and Goldman Sachs - were perfect.

Each firm made money trading the market on EACH of the 61 trading days during the quarter and Goldman Sachs made at least $100 million on 35 days during the quarter. No wonder Wall Street lobbied Congress so hard not change the "rules" of this very profitable game!