The penalty for reckless driving could include a jail term.
Any one who could pose a high risk to community harmony could be detained under ISA.
However, for executives and operatives causing severe financial crisis, there is no law to punish these people. We should enact laws to punish any executives and operatives responsible for severe financial crisis with stiff fines and jail terms, ie those executives and operatives whose cos need to be bail out should be fined heavily and jailed.
Otherwise, the basic banking operations should be separated from financial gambling activities to derive record earnings where unquantifiable risks and invalid assumptions are rampant. Traditional banking might be more costly but it is far cheaper than the messy crises occuring more and more frequently.
While you are making appeal for action taken for bank like JPMorgan Chase, President Obama had started to use this appearance to press for tighter regulation of Wall Street. He even made this statement although JPMorgan is one of his finanical backers: “JPMorgan is one of the best-managed banks there is,” he said. “Jamie Dimon, the head of it, is one of the smartest bankers we got, and they still lost US$2 billion and counting.”
The US Justice Department meanwhile had opened an inquiry into JPMorgan ‘s multibillion-dollar trading loss.
And you might like to read the news report below on why there might be an "conflict of interest" when government try to "regulate" Wall Street or banks :
Banks trend fine line in trading
New York: When JPMorgan Chase revealed its US$2 billion (S$2.5 billion) trading loss last week, it looked as through the big Wall Street banks were up to their old tricks, using their government-backed funds to make risky trades in a misguided effort to improve their profits.
But even banks that focus mainly on good, old-fashioned lending do their fair share of high-stakes trading.
While few other banks, if any, pursue the complex strategies that led to JPMorgan’s losses, many traditional lenders regularly buy and sell securities, and make bet with derivatives, as part of their core operations. Financial firms say such activities allow them to earn a basic return on the deposits they collect and to offset balance sheet risks.
These practices are creating a headache for regulators who are trying to devise new rules to prevent another financial crisis.
Regulators are finalising the so-called Volcker Rule, which would ban banks from making speculative bets with their own money. But they face a basic problem: What is proprietary trading?
Such activities are easy to sopt when financial firms run independent trading units devoted to making profits. But regulators find it harder to tell when other activities – like market-making and portfolio hedging – cross the line. So far, regulators do not seem too concerned that the JPMorgan blowup will have broader ramifications on the banking system. The Financial Stability Oversight Council, the panel set up in the wake of the crisis to identify and respond to threats to the banking sectors, is not planning a special meeting to discuss JPMorgan, said a source.
Big banks, even those with little presence on Wall Street, contend that their trading activities are part of prudent risk-management. Without the ability to invest in bonds and other securities, companies argue that they would not be able to make loans or extend credit as easily.
While large part of the available-for-sale bonds is in instruments deemed safe, like Treasurys, the securities can produce big trading gains, especially if their purchases are well-timed.
JPMorgan said its US$2billion loss stemmed from a hedge related to its available-for-sales securities. Specifically, the bank was using a relatively new type of credit derivative that mostly trades off exchange in opaque markets.
After the JPMorgan losses, some analysts say banks could deliver more nasty surprises as they build up big positions in bonds and derivatives, especially if the economy remains weak and interest rates do not behave as banks expect.
“The biggest issue for the next five years in banking is how banks manage their balance sheets in such unprecedented times,” said analyst Mike Mayo.
New York Times
prime,news, The Straits Times,Tuesday, May 15, 2012, Pg A14
I have not much faith in whether US govt could do the right thing or not because I am aware govts in the west are not free to choose because of huge amount of money lobbing by the rich (businesses). I do not see democracy in western countries as true democracy because only the rich could influence govt especially for each election in US each candidates have to spend $200m to win. or there about!
London cannot do it also. We have to confront this problem as a people in the world. Real smart entrepreneurs could make good money within constraints set by the laws preventing irresponsibilities. Only those who depend a lot on trickery/confusion/cheating cannot make money under laws that try to prevent irresponsibilities. I always hear they said entrepreneurs thrive under uncertainties but now they are saying Obama cause uncertainties that US entrepreneurs could not invest! Isn't this a joke?