Written by soundararajan.R on Wednesday, January 27, 2010 at 10:43 PM

When a man is given absolute power without any rules, he is bound to follow a path which would destroy him and his society. Have you ever wondered why does a country have a constitution and what purpose does it serve. It actually steers the government in the right direction when it sways away from its path. These are required for successful functioning of a society. Is there any kind of rules and regulation for the banks in the Wall Street?

The major banks of US were given absolute power, when restraining provisions in the Glass-Steagall act were scrapped by the Bill Clinton government through the Financial Services Modernization act, 1999. This was the starting point of the bubble which shattered the whole world when it blew in 2008 and plunged all the economies into recession.

Last week was a little tough for the Obama administration as it lost the Massachusetts senate seat to a republican candidate. Still Obama has not given up his fight against the business lobbyist and he has proposed many reforms in the banking sector in the coming days. He proposes a tax that would generate $9 billion a year for 10 years. And this action has drawn strong criticism from the whole banking fraternity. This actually is a very small amount when considered to the $700 billion for the troubled asset relief program these banks had earlier received.

He has taken the first step in the right direction to rein in the banks. This might seem a little tough to grasp because of the negative campaigns by the bankers, but this initial step would finally result in a set of rules framed for these irresponsible bankers who are the sole reason for the crisis in which we are now. Hopefully we would not face another such economic catastrophe in the future.


About the author

This is the area where you will put in information about who you are, your experience blogging, and what your blog is about. You aren't limited, however, to just putting a biography. You can put whatever you please.