HAVE NO INCOME OR NO JOB?
           WHY, MY GRANDMOTHER WOULD BE MORTIFIED TO THINK THAT THAT'S THE
           EDGE I CAN THAT WE THINK MAKES SENSE -- THE ETHIC THAT WE THINK
           MAKES SENSE IN THIS KIND OF ECONOMY. WELL, WE CAN'T CORRECT ALL
           THAT HAVE IN THIS DISCUSSION. BUT WE CAN CORRECT A COUPLE
           THINGS. I DESCRIBED NOT NIGH SON'S CREDIT CARD SOLICITATION --
           I DESCRIBED DERIVATIVES, TRADED IN PROPRIETARY BANKS IN
           ACCOUNTS. I DESCRIBED THE POTENTIAL REGULATION OF HEDGE FUNDS.

           THOSE ARE TWO BIG ISSUES, VERY COMPLICATED ISSUES. WE CAN
           CORRECT THAT. AND SO I INTEND TO OFFER TWO AMENDMENTS. AND I
           WILL SEND THE AMENDMENTS TO THE DESK AND SEND THE FIRST TO THE
           DESK AND ASK THAT IT BE SET ASIDE BY CONSENT AND THEN I WILL
           SEND THE SESQUITO THE DESK AND DESCRIBE BOTH OF THEM JUST VERY
           BRIEFLY. AND THEN THE COMMITTEE CHAIR AND THE RANKING MEMBER
           WILL PROCEED WITH THE BILL. THEY HAVE OTHER AMENDMENTS. I KNOW
           THAT THEY ARE GOING TO HAVE TO CONSIDER TODAY AND I KNOW THAT

           THEY WANT TO MOVE AHEAD AND FINISH WHATEVER BUSINESS THEY HAVE
           ON THE FLOOR WITH THIS LEGISLATION. MY HOPE OF HOPES IS THAT
           ENOUGH MEMBERS OF THE SENATE WILL TAKE A LOOK AT THIS BILL IN
           FINAL FORM AND SAY, THIS IS A TERRIBLE BILL, A TERRIBLE IDEA,
           COMING AT A TERRIBLE TIME TIME. AND ENOUGH MEMBERS WOULD VOTE
           AGAINST IT TO SAY, THIS ISN'T MODERNIZATION. THIS IS A HUGE
           STEP BACK IN TIME, AND A HUGE PIT IN WHICH WE'VE LOST THE
           LESSONS THAT WE LEARNED EARLIER IN THIS CENTURY. I DON'T HAVE
           GREAT HOPE THAT'LL HAPPEN, BUT WHO KNOWS?

           LIGHTNING STRIKES AND PERHAPS AT THE END OF THIS DAY, MEMBERS
           OF THE SENATE WILL SAY, YOU KNOW THIS WASN'T SUCH A GOOD IDEA
           AFTER ALL. MR. PRESIDENT, THE FIRST BILL THAT I WILL SEND TO
           THE DESK IS -- THE FIRST AMENDMENT, RATHER, SAN AMENDMENT

           DEALING WITH DERIVATIVES. AND I ASK FOR ITS IMMEDIATE
           CONSIDERATION.
           

           THE PRESIDING OFFICER: THE CLERK WILL REPORT THE AMENDMENT.
           
           THE CLERK:
           

           MR. DORGAN: MR. PRESIDENT LET ME ASK THAT IT BE KURDS A READ.
           

           THE CLERK: THE SENATOR FROM NORTH DAKOTA, MR. DORGAN, PROPOSES
           AN AMENDMENT NUMBERED 312.
           

           MR. DORGAN: I ASK UNANIMOUS CONSENT THAT THE AMENDMENT BE
           CONSIDERED AS READ.
           

           THE PRESIDING OFFICER: WITHOUT OBJECTION.
           

           MR. DORGAN: MY INTENTION IS TO SAY THAT IT IS INCONSISTENT WITH
           THE OBLIGATIONS AND OUR EXPECTATIONS OF INSTITUTIONS WHOSE
           DEPOSITS ARE INSURED BY DEPOSITORY INSURANCE AND IN FACT
           GUARANTEED BY THE AMERICAN TAXPAYER FOR THEM TO BE TRADING IN
           DERIVATIVES ON THEIR OWN PROPRIETARY ACCOUNTS. I UNDERSTAND
           BANKS BEING A CONDUIT FOR THE TRADING OF DERIVATIVES FOR
           CUSTOMERS. BUT FOR BANKS IN THEIR OWN PROPRIETARY ACCOUNTS TO
           BE TAKING THE KIND OF RISKS THAT EXIST IN DERIVATIVES I THINK

           EXPOSES ALL TAXPAYERS IN THIS COUNTRY WHO ARE THE GUARANTORS OF
           THOSE DEPOSITS TO THOSE RIFMKST THEY JUST AS WELL COULD HAVE
           PUT SOME TYPE AFTER SLOT MACHINE IN THE LOBBY OF A BANK IF
           THEY'RE GOING TO TRADE IN DERIVATIVES ON THEIR OWN ACCOUNTS. I
           SAY TO THE PEOPLE O OWN THE CAPITAL IN THIS BANK, YOU WANT TO
           GAMBLE, GO TO LAS VEGAS. YOU WANT TO TRADE IN DERIVATIVES, GOD
           BLESS YOU. DO IT WITH YOUR OWN MONEY. DO NOT DO IT THROUGH THE
           DEPOSITS THAT ARE GUARANTEED BY THE AMERICAN PEOPLE AND BY
           DEPOSIT INSURANCE. MY AMENDMENT WOULD PROHIBIT PROPRIETARY
           TRADING OF DRIF TIFMTS I ASK UNANIMOUS CONSENT THAT THE
           AMENDMENT BE SET ASIDE.
           

           THE PRESIDING OFFICER: IS THERE OBJECTION?
           WITHOUT OBJECTION.
           

           MR. DORGAN: I SEND A SECOND AMENDMENT TO THE DESK. AND I ASK
           FOR ITS IMMEDIATE CONSIDERATION.
           

           THE PRESIDING OFFICER: THE CLERK WILL REPORT THE AMENDMENT.
           

           THE CLERK: THE SENATOR NORTH DAKOTA, MR. DORGAN, PROPOSES
           AMENDMENT NUMBERED 313. AT THE END OF TITLE 3, INSERT
           
           THE FOLLOWING:
           
           "SECTION 312: TREATMENT OF LARGE HEDGE FUNDS UNDER INVESTMENT
           COMPANY ACT OF 1940 1940. SECTION 3(C) OF THE INVESTMENT
           COMPANY ACT OF 1940. 15 UNITED STATES CODE 80(A) -- 3(C)
           AMENDED.
           

           MR. DORGAN: MR. PRESIDENT, I ASK THAT THE AMENDMENT BE
           CONSIDERED AS READ.
           

           THE PRESIDING OFFICER: WITHOUT OBJECTION.
           

           MR. DORGAN: I WANT TO TELL A STORE RACE DESCRIBE THIS
           AMENDMENT. ABOUT TEN YEARS AGO I WAS SERVING IN THE HOURX ON
           THE WAYS AND MEANS COMMITTEE, AND TEN YEARS AGO AS YOU MIGHT
           RECALL IN THIS COUNTRY WE HAD THE MARKETING OF JUNK BONDS; THAT
           NONINVESTMENT-GRADE BONDS -- BY DREXEL BURNHAM, MICHAEL MILKEN
           AND OTHERS. IT WAS GO-GO ECONOMY AND THEY HELD CONFERENCES AND

           TALKED ABOUT HOW YOU COULD TURN A MINOA INTO A WHALE AND ARM A
           MIOA WITH JUNK BONDS AND THEY'LL GO AFTER AND BITE THE TAIL OFF
           OF A WHALE. IT WAS A REALLY REMARKABLE THING TO SEEFMT ONE OF
           THE THINGS THAT OCCURRED TO ME WAS HOW UNHEALTH CHAINED
           UNWHOLLY IT WAS IN THIS COUNTRY THAT JUNK BOND SELLERS WERE
           PARK JUNK BONDS WITH SAVINGS AND LOANS, AND OUR SAVINGS AND
           LOANS, WHOSE DEPOSITS WERE INSURED BY THE FEDERAL GOVERNMENT,
           WERE THEN ENDING UP WITH JUNK BOND -- NONINVESTMENT-GRADE BOND

           -- IN THEIR PORTFOLIO SO THAT IF THE ENTERPRISE WENT BELLY-UP,
           THE AMERICAN TAXPAYER WOULD END UP PAYING THE BILL. SO LET ME
           GIVE YOU THE CREME DE LA CREME HERE, THE HOOD ORNAMENT ON THE
           EXCESS. WE HAD ONE OF THE BIGGEST CASINOS BUILT IN ATLANTIC
           CITY, GLITZY AND BIG. YOUNG BONDS WERE ISSUED FOR THE CASINO.
           BUT WITH JUNK BONDS, THEY BUILT A KA SEE KNOW, THE JUNK BONDS
           GET PARKED WITH THE SAVINGS AND LOAN. THE SAVINGS AND LOAN GOES

           BELL LEUP AND GUESS WHO ENDS UP WITH THE BONDS THAT ARE
           NONCONFORMING IN A CASINO?
           THE AMERICAN TAXPAYER. THE U.S. GOVERNMENT AND THE AMERICAN
           TAXPAYER END UP HOLDING JUNK BONDS THAT ARE NONPFIRMING JUNK
           BONDS IN A CASINO. HOW DID THAT HAPPEN?
           BECAUSE IT WAS ALL RIGHT ACCORDING TO OUR REGULATORS AND ALL
           RIGHT ACCORDING TO LAW FOR OUR SAVINGS AND LOANS TO GO OUT AND
           BUY JUNK BONDS AND LOAD UP. ONE CALIFORNIA S&L HAD ABOUT 50% OF
           ITS ASSETS INVESTED IN JUNK BONDS. SO I GOT AN AMENDMENT

           PASSED. IT'S NOW LAW. AND OF COURSE IT CAUSED SOME CHAOS. SOME
           PEOPLE HAVE NEVER FORGIVEN ME FOR T BECAUSE I GOT AN AMENDMENT
           PASSED THAT SAID, SAVINGS AND LOANS -- THAT THOSE WHOSE
           DEPOSITS ARE INSURED BY THE FEDERAL GOVERNMENT -- CANNOT
           PURCHASE JUNK BONDS AND MUST DIVEST THOSE THEY HAVE. WHY, I HAD
           A DEVIL OF A TIME GETTING IT PASSED. JUST AN AWFUL TIME. BUT I
           GOT IT PASSED. IT CAME LAW. AND IT CAUSED ALL KINDS OF CHAOS
           FROM THOSE WHO WERE PARKING ALL THESE BONDS IN SAVINGS AND

           LOANS AND PLAYING IN FINANCIAL ROULETTE GAME THEY WERE PLAYING.
           BUT IT WAS DONE. IT WAS THE RIGHT THING FOR THE TAXPAYERS OF
           THIS COUNTRY TO HAVE DONE. I MENTION THAT ONLY BECAUSE
           FINANCIAL INSTITUTIONS WILL DO WHAT THEY MUST AND WILL DO WHAT
           THEY CAN UNDER THE RULES AS LONG AS WE'RE OOKING THE OTHER WAY.
           I'M NOT SAYING THEY'RE ALL IRRESPONSIBLE. I'M SAYING THEY ARE A
           ALL GOING TO TRY TO PURSUE THE LARGEST RATE OF RETURN THEY CAN
           POSSIBLY PURSUED AND ESPECIALLY IF YOU'VE GOT THE DEPOSITS

           UNDERWRITTEN. THOSE INSTITUTION ARE GOING TO TAKE ADVANTAGE OF
           THESE OPPORTUNITIES. IT WAS TRUE IN THE 1980'S. IT'LL BE TRUE
           IN THE NEXT DECADE AS WELL. THE LESSON WITH RESPECT TO JUNK
           BONDS, THE LESSON WITH RESPECT TO DERIVATIVES AND HEDGE FUNDS
           IS THAT WE HAVE TO BE VIGILANT. DID THE BANK REGULATORS JUMP ON THIS AND DEAL WITH IT?
           NO. IN FACT, YOU KNOW THAT THE SECRETARY OF THE TREASURY WOULD
           COME TO THE WAYS AND MEANS COMMITTEE AND SAY, MR. SECRETARYS --

           MR. SECRETARY, WE'VE GOT A CRISIS GOING ON HERE. WHAT ON EARTH
           ARE YOU DOING SIGNATURE ON YOUR HANDS?
           
           

           >> THERE'S NO PROBLEM HERE AT ALL, MR. DORGAN. THE PROBLEM
           TURNED OUT TO BE
           

           MR. DORGAN: THE PROBLEM TURNED OUT TO BE HUNDREDS OF BILLIONS
           OF DOLLARS TO THE AMERICAN TAXPAYER BECAUSE THOSE WHO WERE
           SUPPOSED TO BE INVOLVED LOOKED THE OTHER WAY. AS WE PASS THIS
           PIECE OF LEGISLATION TODAY, WE WOULD DO OUR SKEFS A FAIRXF I
           THINK, PASSING AN AMENDMENT -- WE WOULD DO OURSELVES A FAIRXF I
           THINK, PASSING AN AMENDMENT THAT WOULD PROHIBIT PROPRIETARY
           TRADING IN DERIVATIVES BY BANKS AND ALSO PASSING THE AMENDMENT
           I JUST SENT TO THE DESK THAT WOULD PROVIDE REGULATION FOR HEDGE

           FUNDS WITH RESPECT TO THOSE HEDGE FUNDS THAT HAVE AT LEAST $1
           BILLION OR MORE IN ASSETS. IT IS HANDFUL OF HEDGE FUNDS,
           PERHAPS FEWER THAN 100. THEY HAVE AGGRESSIVE LEVERAGE. IT SEEMS
           TO ME THAT WHILE I WOULD LIKE TO BE MORE AGGRESSIVE IN THE
           REGULATION OF HEDGE FUNDS, AT LEAST THIS WOULD BE A START IN
           DEALING WITH THIS ISSUE. MR. PRESIDENT, I BELIEVE THAT THESE

           TWO -- I WILL NOT OFFER THE THIRD AMENDMENT. I WILL OFFER ONLY
           THREES TWO AMENDMENTS. I BELIEVE THAT THE LEGISLATION IS
           INAPPROPRIATE AT THIS TIME. AND I INTEND TO VOTE AGAINST THE
           LEGISLATION ON FINAL PASSAGE. AS I'VE SAID ON A COUPLE OF
           OCCASIONS THIS AFTER NOORNTION -- THIS AFTERNOON, I THINK THIS
           IS A GIANT STEP BACKWARD. I THINK IT DOES NOTHING FOR ORDINARY
           PEOPLE, DOESN'T ADDRESS ANY OF THE ISSUES. IT IS SOMETHING THAT
           WILL MAKE A NUMBER OF THE LARGEST ENTERPRISES IN THIS COUNTRY
           WHO ARE ALREADY MAKING SUBSTANTIAL PROFITS VERY, VERY HAPPY AND

           I GUARANTEE EVERY MEMBER OF THIS BODY THAT IF THIS LEGISLATION
           IS PASSED, WHEN YOU WAKE UP DAY AFTER DAY, WEEK AFTER WEEK, AND
           MOVENTS AFTER MONTH, YOU WILL READ -- MONTH AFTER MONTH, YOU
           WILL READ THE NEWS OF MORE AND MORE AND MORE MERGERS IN GREATER
           CONCENTRATION AND THEN DON'T YOU COME TO THE FLOOR OF THE
           SENATE AND TALK TO ME ABOUT COMPETITION AND DON'T YOU COME TO
           THE FLOOR OF THE SENATE AND START PREACHING ABOUT FREE MARKETS.
           THE OPPORTUNITY TO RESPOND TO REAL COMPETITION AND FREE
           MARKETS, IN MY JUDGMENT, IS BY TURNING THIS LEGISLATION DOWN,

           ENFORCING STRONG ANTITRUST ENFORCEMENT, AND BEING THOUGHTFUL
           ABOUT THE THINGS THAT WE HAVE TO TO IN THE FUTURE TO PRESERVE
           THE SAFETY AND SOUNDNESS OF OUR BANKS AND, YES, TO ENCOURAGE
           INVESTMENT, ENCOURAGE ECONOMIC ACTIVITY IN OTHER SECTORS OF OUR
           ECONOMY. LET ME CONCLUDE BY SAYING
           
           THIS: I'M NOT SOMEONE WHO THINKS THAT BIG FIRMS ARE BAD. I
           DON'T BELIEVE THAT AT ALL. NOBODY IS GOING TO BUILD A 7 A 7 JET
           AIRPLANE IN THE GARAGE IN REGENT, NORTH DAKOTA. ECONOMIES OF

           SCALE ARE IMPORTANT. SOME OF THE LARGEST ENTERPRISES HAVE
           CONTRIBUTED MIGHTILY TO THIS COUNTRY AND ITS ECONOMY. BUT I
           ALSO BELIEVE THAT WHAT CONTRIBUTES MOST TO THIS COUNTRY IS
           GOOD, OLD-FASHIONED HEALTHY COMPETITION. BROAD-BASED ECONOMIC
           OWNERSHIP -- AND I KNOW ITS REAL ESTATE A TIME-WORN AND SOME
           CONSIDERED OLD-FASHIONED JEFFERSONIAN NOTION OF DEMOCRACY THAT
           BROAD-BASED ECONOMIC OWNERSHIP IS WHAT EVENTUALLY GUARANTEED
           ECONOMIC FREEDOM AND WHAT EVENTUALLY UNDERSCORES AND GUARANTEES
           POLITICAL FREEDOM AS WELL. THAT IS SOMETHING THAT IS VERY

           IMPORTANT TO THIS COUNTRY'S FUTURE. AND WE DO NOT ADVANCE IN
           THAT DIRECTION BY PASSING LEGISLATION THAT WILL FURTHER
           CONCENTRATE AND FURTHER PROVIDE INDUCEMENTS FOR MORE MERGERS
           AND BIGGER -- MORE CONCENTRATION AND BIGGER KFMTS THAT WILL NOT
           ADVANCE THIS COUNTRY'S INTERESTS. MR. PRESIDENT, I YIELD THE
           FLOOR. AND I MAKE A POINT OF ORDER IN A A QUORUM IS NOT
           PRESENT. -- THAT A QUORUM IS NOT PRESENT.
           

           THE PRESIDING OFFICER: THE CLERK WILL TAKE THE ROLL.
           
           
           
           
           QUORUM CALL:
           

           MR. GRAMM: MR. PRESIDENT?
           
           

           THE PRESIDING OFFICER: THE SENATOR FROM TEXAS.
           

           MR. GRAMM: MR. PRESIDENT, I ASK UNANIMOUS CONSENT THAT FURTHER
           PROCEEDINGS UNDER THE QUORUM BE DISPENSED WITH.
           

           THE PRESIDING OFFICER: WITHOUT OBJECTION.
           

           MR. GRAMM: MR. PRESIDENT, OUR CURRENT BLUEPRINT IS THAT WE'RE
           GOING TO VOTE ON THE UNITARY THRIFT AMENDMENT AT
           
           3:45. EACH SIDE WILL HAVE THREE MINUTES TO SPEAK ON THAT ISSUE.
           I WILL ASK SENATOR GORTON TO SPEAK ON BEHALF OF THE MAJORITY
           MAJORITY. AT THE CONCLUSION OF THAT AMENDMENT, THE SHELBY
           AMENDMENT WILL BE CONSIDERED. THAT IS THE AMENDMENT THAT WOULD
           ALLOW BANKS TO PROVIDE BROAD FINANCIAL SERVICES WITHIN THE

           STRUCTURE OF THE BANK RATHER THAN THROUGH THE HOLDING COMPANY.
           WE HAVE AGREED TO A TWO-HOUR DEBATE ON THAT AMENDMENT. SO IF WE
           GOT ON THAT
           
           AMENDMENT, SAY, AT 4:10, WE WOULD BE THROUGH WITH THAT
           
           AMENDMENT AT 6:10. I DON'T KNOW OF ANOTHER MAJOR AMENDMENT. I
           WANT TO UE MY COLLEAGUES, SINCE WE'VE GOT A LOT OF MEMBERS WHO
           ARE, A, HOPING NOT TO BE HERE TOMORROW -- MEMBERS WON'T OBJECT

           TO THAT, I ASSUME -- AND THAT WOULD LIKE TO CATCH A FLIGHT BACK
           TO THEIR STATES AT A REASONABLE HOUR, IF THEY COULD, SO NOT TO
           CONVENIENCE ME OR TO CONVENIENCE MY COLLEAGUE, SENATOR SAR
           BAIRNTION BUT TO CONVENIENCE ALL -- SENATOR SARBANES, BUT TO
           CONVENIENCE ALL 100 MEMBERS OF THE SENATE, I WANT TO URGE THESE
           WHO HAVE AMENDMENTS TO COME TO THE FLOOR AND PRESENT THEM.
           
           PLEASE DON'T SHOW UP AT 6:10 AND SAY, OH, BY THE WAY, I JUST

           HAD AN IDEA LAST NIGHT WHILE I WAS HAVING DESSERT
{END: 1999/05/06 TIME: 15-00 , Thu.  106TH SENATE, FIRST SESSION}