Wall Street Hopes You've Forgotten the Crash Already

Remember October 2008 -- the bank bailouts, the spiking unemployment rate, the stock market free fall?

Maybe you lost a job, got a pay cut, or saw your retirement savings or home value evaporate. Maybe you even lost your home altogether, or saw your small business wither and die.

It's a hard thing to let go. But Wall Street is hoping you've already forgotten it.

That's because their allies in Congress and the Trump administration are poised to scrap the reforms that lawmakers put in place to prevent another meltdown.

For starters, they're trying to gut the Consumer Financial Protection Bureau, the first independent agency with the sole mandate of protecting consumers against scam artists, predatory lenders, and bad actors in the financial sector.

The agency proved its mettle last year, when it caught Wells Fargo -- the second biggest bank in the country -- creating millions of bogus accounts without their customers' permission. The bureau exposed that cheating and put an end to it.

Dodd-Frank, the law that created the bureau, also made rules to keep banks from making risky bets with your money.

For instance, it requires banks to keep some skin in the game by maintaining a 5 percent stake in loans they originate, so they have a stake in the success of the borrower and the loan. It also encourages banks to keep some cash on hand in case of emergencies, just like the rest of us try to do at home.

Yet lately, bankers have been complaining that financial regulation is hurting the economy. Gary Cohn, a former Goldman Sachs president -- and now a Trump economic adviser -- whined recently that banks are being forced to "hoard capital."

If maintaining a prudent reserve is hoarding, then yes. And that's a good thing.

Bankers like Cohn say abolishing these rules will help ordinary consumers. When you hear things like that, hold tight to your wallets and purses.

The truth is, cheap credit is abundant. The commercial and industrial business industries are booming. Credit card and auto lending are at record highs, and mortgage loans are almost back to their pre-2008 crisis high.

If that's not enough for Wall Street lenders who want to gamble, they should go to the casino. And if venture capitalists want to take great risks in search of great rewards, blessings upon them. But they shouldn't expect the rest of us to bail them out after their next binge.

What about Donald Trump? Will he protect us?

Trump campaigned as a champion for the "little guy," beholden to no one because of his independent wealth. He smeared opponents like Ted Cruz and Hillary Clinton for being "puppets" of big banks like Goldman Sachs.

My advice? Watch what Trump does, not what he says.

After all, Trump just installed the most pro-Wall Street team our nation has ever seen. Three of his senior advisers -- including Treasury Secretary Steven Mnuchin -- have a combined 40 years at Goldman Sachs.

Now they'd like to remove the sheriff from the financial sector. If they get their way, I'll give you better odds than Vegas that they'll crash the economy again -- and stick you and me with the bill.

Lock up your treasure. Call your lawmaker. Don't go back to sleep.