Congress: Taxpayers Will Cover Citigroup’s Bad Bets

Unregulated derivatives trading crashed the U.S. economy back in 2008, and two years later Congress passed laws to prevent that from happening again. But Citigroup just wrote derivatives deregulation into the $1.1 trillion federal funding bill, and Congress passed it. Now Citi can blow people’s savings on bad exotic derivatives bets, and taxpayers will likely cover the losses.

Here’s what Senator Elizabeth Warren (D-MA) had to say about that:

More:

“‘Enough is enough’: Elizabeth Warren’s launches fiery attack after Congress weakens Wall Street regs,” Wonkblog staff, Washington Post

“Wall Street Seeks to Tuck Dodd-Frank Changes in Budget Bill,” Ben Protess, New York Times Dealbook

“How Citigroup Lobbyists Just Gutted Accountability For Wall Street,” Alan Pyke, Think Progress

“Furor Over Move to Aid Big Banks in Funding Bill,” Jonathan Weismande, New York Times

“Wall Street’s Omnibus Triumph, and Others,” Russ Choma, OpenSecrets

“Inside Wall Street’s new heist: How big banks exploited a broken Democratic caucus,” David Dayen, Salon

“Here Come the Demolition Crews for Dodd-Frank,” Ed Kilgore, Political Animal

“Citigroup to Move Headquarters to U.S. Capitol Building,” Andy Borowitz, The New Yorker [Note: Actually, Citi’s lobbyists are only a few blocks away, in the penthouse of the Evening Star Building -ml]

Update:

“Elizabeth Warren was right: The links between Citigroup and government run deep,” Matt O’Brien and Darla Cameron, Washington Post

“Citigroup PR: Stop, You’re Making It Worse,” Alexis Goldstein, Medium

“Citigroup Will Be Broken Up,” Simon Johnson, Baseline Scenario

“’Utterly indefensible’: Paul Krugman slams Congress for allowing banks to gamble with taxpayer money,” Luke Brinker, Salon

“Conservatives Grudgingly Praise Warren, Pelosi For Opposing ‘Wall Street Giveaway,'” Samantha Lachman, Huffington Post

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Image (“Trading Derivatives, after C. M. Coolidge”) by Mike Licht. Download a copy here. Creative Commons license; credit Mike Licht, NotionsCapital.com

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Tags: banking, Citi, Citibank, Citigroup, Congress, credit default swaps, CrOmnibus, deregulation, Dodd Frank, FDIC, finance, lobbyists, Omnibus bill, speculation