Future Fed Oversight: 23 Banks ?
There are a handful of good ideas in some of the latest proposals floating around: Consolidate all of the banking oversight into one super regulator to prevent forum shopping. Then give that regulator teeth. (I suggest the FDIC is the best office to do this in).
Here are some of the proposals under discussion:
“Strip the Federal Reserve of regulatory powers over all but the very largest banks, those with more than $100 billion in assets, people briefed on the negotiations said on Monday night.
The plan would remove Fed oversight from all but 23 of the 4,974 bank holding companies, which have a collective $16.7 trillion in assets, and from 874 state-chartered member banks that are members of the Fed system and that have a total of $1.7 trillion in assets.
The vast majority of the bank holding companies would be overseen by a regulatory agency formed from a merger of the Office of the Comptroller of the Currency, which oversees national banks, and the Office of Thrift Supervision, which regulates savings and loans, the individuals said. Regulation of the state banks would go to the Federal Deposit Insurance Corporation, which already oversees about 5,000 banks that are not part of the Fed system.”
Perhaps the rationale for the big banks staying under the jurisdiction of the Fed is that it somehow effects monetary policy through their primary dealers of US Treasuries.
But I don’t see why we want or need to keep the Fed overseeing even those 23 banks . . .
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Source:
Fed’s Reach May Be Curbed Under Plan
SEWELL CHAN
NYT: March 8, 2010
http://www.nytimes.com/2010/03/09/business/economy/09regulate.html
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March 9th, 2010 at 9:23 am
We need the Fed like we need cancer. Large tumor or small?
March 9th, 2010 at 9:26 am
When has a regulation stoped banks from nothing? Regulations only help the big banks.
March 9th, 2010 at 9:37 am
It’s very simply for the big banks, who would then fall under much tougher regulations: they will either pass their costs along to the customers, or they will split into many, much smaller entities to get around the oversight. Those 23 would become 9-10 over a decade, and the ones who are no longer in that group would become 75 smaller entities.
These guys don’t build the biggest buildings in every town by being stupid.
March 9th, 2010 at 10:04 am
ashpelham2 Says:
“It’s very simply for the big banks, who would then fall under much tougher regulations: ”
Funny you actually expect the FED to be tougher to the banks that control…. The FED
March 9th, 2010 at 10:17 am
the ots? occ? these nitwits snoozled and fiddled while rome burned. i suppose the “plan” would consolidate all the current incompetents employed by these 2. typical. god forbid anyone should be held liable for anything.
March 9th, 2010 at 10:33 am
“Perhaps the rationale for the big banks staying under the jurisdiction of the Fed is that it somehow effects monetary policy through their primary dealers of US Treasuries.”–BR, above
Bingo!
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though, past that, “We need the Fed like we need cancer. Large tumor or small?”–MA, above
“Funny you actually expect the FED to be tougher to the banks that control…. The FED”–Robespierre, above
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Can We, finally, agree that the FedRes is, only, in it for themselves?
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“…Glenn Greenwald of Salon.com explores this problem at length, pointing out the other side of the coin, that in Media-World, those who are certifiably insane are being labeled as “sane” as long as they stay within predesignated boundaries. For example:
…
Greenwald is not suggesting that those who step out of the mainstream are always correct about everything they say. But he does give credit to Alan Grayson, Dennis Kucinich and Ron Paul for not buying into most of the rubbish that we are being fed by the media. We live in world painted upside-down by a media that is largely not about traditional Fourth Estate values. Rather than feed us information that will allow a democracy to thrive, the mainstream media, based on its constant miserable failures over the past ten years, is clearly more interested in destroying those who dare to ask questions that might threaten our corporate-military-prison-industrial-Complex…”
http://dangerousintersection.org/2010/03/04/who-is-crazy/
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and We know who finances “our corporate-military-prison-industrial-Complex”, yes?
March 9th, 2010 at 10:40 am
“Consolidate all of the banking oversight into one super regulator to prevent forum shopping. Then give that regulator teeth.” – that’s EXACTLY what Harry Markopolos recommended in his testimony to the House Financial Services committee 2-4-09. Here’s a link to that testimony, worth a 2nd or even 3rd listen to, http://cspan.org/Watch/watch.aspx?MediaId=HP-A-15082 .
March 9th, 2010 at 10:40 am
clipb Says:
March 9th, 2010 at 10:17 am
the ots? occ? these nitwits snoozled and fiddled while rome burned. i suppose the “plan” would consolidate all the current incompetents employed by these 2. typical. god forbid anyone should be held liable for anything.
This entire point can be said of the SEC as well… Watched Harry Markopolous last night on TDS. Those regulators fiddled while Madoff burned all his investors… for 8 years… and still NO ONE at the SEC has been held accountable. He’s P!@@ed with a capital “P” — he didn’t try to hide his feelings at all. On the one hand he came off a bit smug; OTOH I understand his frustration. This entire country should be frustrated. Do we need to form angry mobs in the streets? ‘Cuz I’m about ready to organize…
March 9th, 2010 at 11:16 am
MEH:
Good comment. Kucinich, Paul and Grayson are what we need more of.
March 9th, 2010 at 11:31 am
The Federal Reserve System is and always has been a government enforced cartel of major Wall St banks.
The original secret & sordid history of this 1910 Jekyll Island creation has long been an open book, but most Americans still foolishly view it as some benevolent ‘regulatory’ agency… valiantly protecting the public & economy from those greedy banksters. That Jekyll cabal… the Morgans, the Rockefellers, Kuhn, Loeb & Company, the Rothschilds and the Warburgs– were the major competitors in investment and banking in those days; but they saw a much better option than fair competition.
Small & medium banks are not part of the cartel… the Federal Reserve System regulation keeps a lid on new competitive banks so they never grow and threaten the big boys on Wall Street.
The Federal Reserve is incapable of accomplishing its stated objectives. It is a cartel operating against the public interest.
You can fool enough of the people enough of the time.
March 9th, 2010 at 12:00 pm
I’m not so sure I trust the FDIC to regulate risk, after seeing this:
“The Federal Deposit Insurance Corp. is trying to encourage public retirement funds that control more than $2 trillion to buy all or part of failed lenders, taking a more direct role in propping up the banking system, said people briefed on the matter.”
http://www.bloomberg.com/apps/news?pid=20601109&sid=aDuLDy3OUFmg
March 9th, 2010 at 1:25 pm
Does any of this matter if the people who head up these regulatory agencies simply refuse to regulate, whether by ideological fiat, lack of manpower or whatever? Let’s say we create this great new regulatory body that does everything we want it to do. What’s to prevent a President Jeb Bush or Bill Clinton, Jr. from coming in and saying, “Hey, don’t regulate so hard, I need a bubble in the markets for my political goals..”
March 9th, 2010 at 1:28 pm
I would like to know which Regulator Agency is the Fed going to fall under — who regulates the Fed?
March 9th, 2010 at 1:53 pm
You want the big boys out of the FDIC because you can’t comingle the FDIC funding. If the little banks contributions went to bailing out the big boys there would be hell to pay.
Also, “These guys don’t build the biggest buildings in every town by being stupid”. Yeah, the build the biggest buildings in every town because they have our money and, you know, it’s fungible. I had a teacher once who said you can tell the values of a culture by it’s tallest building – used to be churches….