Donald Trump wants the big banks to take the kind of risk that caused the housing crisis. I started working in the hedge fund industry as an accountant in 2008. I saw their books, including some held at Lehman Brothers. It was mostly a bunch of write-offs and unwinds and legal payments.

I am fully aware of the personality of these people. They intend to work on Wall Street for only 2 years and then move to a private equity firm, which means that they most likely won’t be around when their actions start to cause major damage years later. Most of them are gamblers, unscrupulous, rude to their clients, and generally seem like they don’t care about anyone but themselves. I’ve seen it, lived it, and got the hell out of it.

The housing crisis was the best evidence that this way of thinking is dangerous when this type of person is managing your money. The excess risk, the short time horizon, the carelessness about client goals, and the lack of a backup plan in case they fail is what caused the financial crisis that many people are still feeling. Many people who had planned to retire at 65 are still working, and many people have just as much or less than they had before 2008.

Dodd-Frank was passed to prevent all the pain caused by these people. Moreover, they endeavored to rein in their behavior. They wanted to stop all the risk-taking. They wanted to make sure that commercial banks couldn’t speculate with depositor money such that the money wouldn’t be available if you went to the ATM. They created a bunch of oversight and even a new agency, the CFPB. They also gave the SEC and the CFTC the “authority to regulate “over-the-counter” derivatives trading.” They even increased capital requirements so that banks couldn’t gamble away the last dollar in the vault.

I can’t say whether another crisis would happen again, and very few people could predict that, but these protections make sure that we minimize the damage to the general public.

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