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Eisinger says the Volcker Rule is voluminous and complex with 530 pages, because banks and lobbyists with complicit regulators wanted it that way. This is also what Volcker told Charlie Rose in an interview, that banks can't complain that it is complex and at the same time work to add complex language to the rule.

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This editorial lists the essential points that the Volcker Rule- as it is written by U.S. regulators -must include to ensure the safety of the American financial system. These points cover limiting speculation, putting in place clearly defined and strong penalties, and addressing loopholes.

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Gongloff points out that the word exemption occurs on 100 of the 200 pages of the final draft of the Volcker Rule published for comments in September 2011, for a total of 426 times. The banks have 2 years after its introduction in July 2012 to comply with its provisions and are allowed to petition the board for 3 one year extensions taking the process to July 2014 or July 2017. And this whole exercizes resembles some form of kabuki theater as the title of this piece suggests, and makes going through its detail meaningless. Especially since the probability of a new administration in 2014 or in 2017 are high. At that time new rules would be written.

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Vernon Smith asks the question why when $10 trillion in losses were experienced in equities in 1999-2002 the financial system did not collapse, and in 2008 losses of $3 trillion in mortgages held by homeowners resulted in a collapse of the financial system. In the 2002 period the losses, he says, were borne largely by institutional and individual investors who largely owned the assets outright. In the 2008 crisis homeowners purchased about 90 to 100% of the housing assets on margin, and declines in value of 50% or more in the low price tier were seen for homes bought at the peak of the bubble. These losses were transmitted to banks and lending institutions. The consumption binge added to the debt of households. The result is that lending went down sharply for durable goods consumption, and this is seen in the decline of auto sales of 41% from Feb. 2008 to Feb. 2009. The collateral damage then occurs in retail and labor markets. This is similiar to how Ben Bernanke viewed the Great Depression crisis in an important paper- the inability of the financial system to perform its economic role of lending to households for durable goods consumption and to companies for production and trade. This understanding is different from the Friedman view of a contraction of the money supply, and the view that excessive speculation caused it. Bernanke's experience studying the causes of the Great Depression uniquely qualified him to address the causes of the global financial crisis of 2008....

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PM Modi visits Gandhiji's Sabarmati Ashram in Ahmedabad and inaugurates the $145 million Sabarmati Ashram renovation project. In June 1917 Mohandas Gandhi bought land on the banks of the Sabarmati river to build the Ashram. It was the central location for Gandhiji's struggle with the British for Hind Swaraj, independence from Britain. The ideas in Gandhi's Hind Swaraj written in 1910 during the struggle for South African workers was implemented from here including the Satyagraha struggles, negotiations with the British Raj, Dandi march to the sea in April 1930 to protest the tax on salt. It was originally on 120 acres which by 2020 were reduced to 5 acres. The new project will expand the Ashram to 57 acres into a major worldwide center for learning about Gandhi's life and ideas and the role for gaining Bharat Swaraj or freedom and its role in Bharat's future for a new generation of youth. Leaders including Sardar Vallahbhai Patel and Narendra Modi look to Gandhiji's ideas for inspiration and guidance in the everyday administration of the country. Gandhi's ideas anticipate not just the aspirations for freedom with taking responsibility for one's own actions, but also the movements for respecting nature through climate change action, uplifting of rural areas, and the improvement of the living conditions of working people and families everywhere in the world. The Ashram exhibition shows documents including letters to the Viceroy in the 1920's showing the budget for the Empire in India and asking why so much went to defense and military and so little to uplifting the lives of the people, in education, health and infrastructure. Having seen it at the Ashram one could say such a direct letter to the head of a large nation, as the Viceroy in India was then is unimaginable today. In some ways emails and electronic communication have made contact with officials and government less not more and created a seemingly insurmountable gap today. ...

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Using a new methodology India's statistics agency revises growth for 2013 to 5.1%, for 2014 fiscal year to 6.9%. Growth for 2015 is forecast at 7.4%. For the 3 months Oct-Dec. 2014 the growth in GDP was at 7.5%. Changes in methodology include computing it at market price, not at factor cost. This adds up consumer and firm spending instead of producer costs.

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Amy Chozick of the NYT describes the puzzling idea of a Methodist do-gooder, with serious concern for injustices in the South, making an effort to accumulate money. Especially considering that Hillary Clinton must have known that speechmaking fees would come up in a presidential election campaign. Chozick describes in some detail the two years Hillary tried to shore up the family's finances after Bill Clinton's defeat in the 1980 election for Governor. Following the defeat Bill Clinton went back all over the state to voters to hear their complaints, sometimes for hours at a time. It was upto Hillary to shore up the family's finances. Hillary had to stretch to buy a $112,000 home in a better residential neighborhood. Family friends say Bill was never that interested in money, and never worried about the family's finances. Things were so bleak according to this account that Hillary worried about how they would pay for daughter Chelsea's college tution, as her own mother's experience has always remained with her of being denied a college education because of lack of money. During the Democratic Convention this comes up in the video introduction, something that most people are unaware of, which must have been difficult for an intensely private person like Hillary. Her mother is described in that video as having to go to the corner grocery store as a child with coupons for food. The income of the Clintons as professors in the years around 1975 was $18,000 each. As governor Mr. Clinton earned $33,519 in 1978 with combined income at $51,173 adding Hillary's work at the Rose law firm. A one time deal in the commodities market made 100,000, and an investment in land in the Ozarks led to losses- all at a time when other highly educated people in Arkansas were doing extremely well, including the Walton family. It wasn't until 1992 when Bill Clinton was running for president did the couple make higher income of $297,177 reported in 1992 tax returns. At this time entering the White House, of recent presidents only Harry Truman had lower net worth. Hillary donated her book proceeds for "It Takes a Village," to charity, and turned down an advance. By the time they left office the couple were faced with legal debts, owing $5 million in legal fees- Hillary Clinton saying they were "Dead broke." The former president now sought help to buy a Dutch Colonial in Chappaqua, New York, for $1.7 million. President Jimmy Carter was also facing large losses in his peanut business in Georgia when he left office, only to turn to writing books to salvage his finances. Hoover, FDR, Kennedy, George Bush, George W. Bush, were from families with great wealth or built their fortunes, including candidate Trump, sometimes using influence or connections or in the case of Kennedy's family gaining from the end of Prohibition. Eisenhower, Reagan, Carter were of more modest wealth. Only Harry Truman remains the awesome exception of dignity with extremely modest wealth, a small house in Independence, Missouri, no presidential pension, only an army pension of $112.56 a month in 1953. Truman's story also offers another aspect of public service of an exceptional kind and its value to the country for people to reflect on. A presidential pension of $25,000 was set up one year after Truman left office.  Experts say Truman's Senate Committee over 8 years 1941-1948, helped save billions of dollars in waste, fraud, and in faulty airplane as well as munitions development during the war effort, including saving thousands of lives.  In his farewell address in January 1953, Truman said he had spent 17 hours a day for eight years with no payment for overtime. In the address he correctly predicts that the Cold War would be won and he set the course. It also happened as predicted in that address with changes in the Kremlin and failure in the satellite states. Hillary Clinton put in these 17 hours and gained unmatched experience as Secretary of State, and is in a positon to set the course ahead in a manner that Truman once did in a complex world where careful policy, good judgement and in some situations strong action is needed. Such invaluable public service has never really been rewarded in the way business leaders are, not by a small fraction - too long simply taken for granted.  Considering her life story Hillary Clinton appears to have struggled with this all her life, to create a safety net that too often cracked, sometimes suddenly and unexpectedly. Has this concern sometimes gone too far, could better judgement be exercized. Perhaps or probably. Should it be seen in the context that Truman's situation reminds us. Probably.         ...

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To the other reasons, callousness on social issues and towards women and immigrants, Rove adds additional ones. The lower voter turnout with ony 51.3% of voters turning out to vote in the 2012 U.S. presidential election, the poor timing of the convention when it should have been held in June, the lack of response to an ad blitz with negativity throughout the late summer that Romney lacked funds to respond to. He points to the role of the Super PAC's and the American Crossroads organization he created in preventing the Republican candidate from being strangled by a single ad blitz in the summer that spent 20% of election campaign funds of the Obama campaign.

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By July 2013 only about 40% of the Dodd-Frank financial reform legislation rules were completed, 60% of deadlines were missed, according to law firm Davis Polk & Wardwell LLP. A singular aspect of the Dodd-Frank legislation was that rule making was left to regulators in different agencies and open to lobbying by the financial industry. This has the effect of delaying the rule making until a consensus is reached, diluting some of the original intent as financial firms jockey for advantage, and making it voluminous in many cases because of the wording designed to achieve consensus and account for objections by various interests. Reform legislators such as Barney Frank openly said they had no interest in learning enough about the financial industry to do the rule making, and may have left an excessive amount of the rule making to regulators in the future. A consumer protection agency was established under the new law and derivatives are required to be traded on exchanges. The Volcker Rule to separate investment banking from deposit taking and a requirement that banks hold onto a portion of mortgage securities marketed are not completed. The S.E.C. has to write the rule on how much money brokerages must set aside for losses on swap trades. Another bubble in financial markets would leave the U.S. and European economies vulnerable to problems similiar to the global financial crisis of 2008, which is why the U.S. Federal Reserve, the Bank of England and the European regulatory authorites are requiring large banks to set aside more capital reserves. The S.E.C. under its new chief is also taking a more active role in overseeing the banks for violations of securities laws, including a series of actions taken against JP Morgan Chase bank in 2013. This has a deterrent effect as the huge monetary easing by the U.S. Federal Reserve to reduce unemployment also creates bubble conditions in financial markets, according to Fed governor, Jeremy Stein. Former FDIC chief, Sheila Bair, says the lack of leadership in this area is simply astonishing....

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This briefing in the Economist says China now faces a difficult transition to its next phase of development, in which the government is trying to change the model used by Deng Xiaoping of export led development to a consumption based economy. That model produced spectacular results between 2000 and 2015 when the middle class went up from 5% of the population to 25% of the population, as measured by people living on more than $20 a day in 2011 $ purchasing parity, as reported by IMF, EIU. The problem China faces is can this development stall if it fails to tackle problems in the next phase, with an aspiring group behind the new middle class left behind. Recent jump in the stock markets volatility, devaluing of the currency, and confusing signals sent by the government have hurt its credibility. Demographic issues with an aging population, the destruction of the environment with rampant development, and how to manage this next phase of development with respect for the constitution and the rule of law replacing the high corruption levels, are serious challenges. Experts say it will be difficult to manage a transition to the next phase of development without some degree of democratization. The rise of the internet and the social media have created more avenues for expression, which gives the government some guage of public opinion, especially in tackling pollution, mismanagement, and other problems. The government sees the need to manage things carefully, with rising unemployment posing a problem as growth slows and the government closes down inefficient manufacturing facilities. ...

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Deutsche Bank has lost two thirds of its share value and its leverage is extraordinarily high with total assets at 56 times tangible equity acccording to Morgan Stanley. Progress is being made but not enough say analysts, and raising capital now is better than waiting longer and doing that with a downward spiral in its shares. The loss announced January 14, 2009, of $ 4.8 billion euros for 4th quarter 2009, reflects a loss across all of the bank's businesses, and is a warning sign of the need to raise capital with greater urgency.

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With the reduced demand for Fannie and Freddie mortgages with coupons under 5%, the Fed steps in and purchases $192 billion of 4% and 4.5% conforming mortgages on a gross basis by March 25, 2009. The move helps support falling house prices in the U.S. and reduces mortgage rates. It also helps banks improve profits. Estimates show the top 10 banks increased their holdings of securities issued by Fannie and Freddie and government agencies by $128.6 billion or 30% in 4th quarter 2008, which can be marked up in future quarters.

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Peter Orszag's role in the healthcare debate and the formulation of health care policy proposals. One proposal of Orszag, who heads the Congressional Budget Office, is to set up a new agency with powers to cut spending and implement changes in Medicare. Says Orszag, "one of the reasons we have such disjointed and skewed incentives is that we have an excessively political process." At a recent meeting with House Democrats, one Congresswoman said her top priority is winning higher payments for oxygen suppliers, and Orszag was taken aback. For years officials have been trying to cut payments to oxygen and medical equipment suppliers, which are said to be inflated. When a new competitive bidding process was set to take effect last year, industry supporters in Congress were able to delay the plan, and these supporters are still fighting to block changes says the WSJ. Here is a 40 year old Orszag, with degrees from Princeton and London School of Economics, who got his early experience in the Clinton adminstration at age 24. He then followed this with a number of policy oriented jobs, ending with appointment to head CBO in 2007. And he faces the whole system of Congressmen from both parties beholden to interests in the healthcare industry, who provide the donations for them to finance their election campaigns. Dan Eggen describes this in the Washington Post, 7/21/2009. Max Baucus of Montana, and to some extent Grassley of Iowa, are senators from both parties who Eggen points out are beholden to the healthcare industry because of large donations they receive from the interests in the healthcare industry. These interests want to see their payments system protected. The further escalation in health care costs, which would make the whole healthcare system unaffordable even as it delivers poor results, can only be prevented by making cost control an exercize that is not influenced by healthcare industry donations. Jackie Calmes describes the huge hurdles in achieving a deficit neutral move to universal health care in the U.S. in the NYT 6/26/2009. See the link. The exchange between Grassley and Orszag on the issue of the $177 billion in savings needed from the payments to health insurers under the Medicare managed care plans- which allow seniors to obtain Medicare coverage outside the government run program -went as follows. These are dubbed overpayments by outside experts and efforts have been made to cut them in Congress. When Mr Grassley raised concerns about the impact of such cuts in a hearing, -and Grassley has opposed the cut for this overpayment to insurers- Orszag responded saying: "I very firmly believe that capitalism is not founded on excessively high subsidies to private firms. This is what this system delivers right now." ...

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Thomas Friedman of the NYT sees a climate change as an area in which Trump has ignored the information of eminent scientists. He sees a weakness of the Trump administration in Trump's putting no importance to briefings by experts from climate change to national security briefings. Friedman sees Russia and hacking as a major issue facing the new Trump administration, including the new hearings in Congress from leading Republicans on the cyberattacks.

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This opinion piece in DW.com says India's prime minister should not isolate prime minister Sharif of Pakistan, as he had no part in the escalation of tensions in Kashmir. Foreign and military affairs are now run by the Pakistan Army, and isolating Sharif only entrenches the Army it says, which has kept up tensions similar to the situation in 1999 with the Kargil crisis when the Pakistan Army initiated a conflict in Kargil region. At that time Indian premier Vajpayee and Pakistan premier Sharif were improving relations. 

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The Ethics Commission appointed by Chancellor Merkel following the nuclear disaster in Japan has recommended that the German government close all of its nuclear plants by 2021. Merkel said that Germany will end its dependence on nuclear energy and use nuclear as a bridge technology till other sorces are developed. Germany gets 22.6% of its electricity from nuclear energy, according to the Energy Ministry. It has 17 reactors, six of the boiling water type, a design used at Fukushima, and 11 using pressurized water. A former Environment minister, Klaus Topfer, heads the panel, with the other 22 panel members draw from the energy industry and nongovernmental organizations. While recommending closing the plants "to eliminate risks," the panel said it would also boost the German economy. It said "a withdrawal from nuclear power will spur growth, offer enormous technical, economic and social opportunities to position Germany even further as an exporter of sustainable products and services." Germany has already moved ahead in developing wind and solar energy sources, and is developing leading edge technologies and capabilities in the area of environment friendly alternative energies. Wind and solar energy and renewable sources already meet 16.5% of Germany's needs. Italy and Switzerland said they would not develop new reactors after the Fukushima nuclear reactor meltdown. Only Germany with its strong environmental consciousness across all parties is making a decisive break with nuclear energy. ...