Posts filed under “Crony Capitalists”
This book is next up in my queue. It looks to be a primer on why big, highly leveraged banks are bad for the economy.
More than four years after the financial meltdown devastated the economy, our banking system remains resistant to reform and riddled with risk. The Bankers’ New Clothes challenges us to question the status quo and to think anew about the transformative changes in banking that are needed to serve the public interest. This work should spur a long-overdue debate on real banking reform.”
-Phil Angelides, chairman of the Financial Crisis Inquiry Commission
The Bankers’ New Clothes underscores that there is perhaps no reform more important and central to a stable financial system than capping the ability of financial institutions to take excessive risks using other people’s money.
-Sheila C. Bair, former chair of FDIC and author of Bull by the Horns
The Bankers’ New Clothes accomplishes the near impossible by translating the arcane world of banking regulation into plain English. In doing so, it exposes as false the self-serving arguments against meaningful financial reform advanced by Wall Street executives and the captured politicians who serve their interests. This revelatory must-read shreds bankers’ scare tactics while offering commonsense reforms that would protect the general public from unending cycles of boom, bust, and bailout.
-Neil Barofsky, author of Bailout
Bankers have sold us a story that their risky practices are the necessary cost of a dynamic system. Admati and Hellwig expose this as a misguided and dangerous lie, and show how banks can be made more stable–if less profitable for the bankers themselves–without sacrificing economic growth. This brilliant book demystifies banking for everyone and explains what is really going on. Investors, policymakers, and all citizens owe it to themselves to listen.
-Simon Johnson, coauthor of 13 Bankers
A clearheaded antidote to the ill-advised snap reactions to the financial crisis, The Bankers’ New Clothes carefully counteracts arguments that the banking system is now more secure. With direct and rigorous analysis, Admati and Hellwig lay bare the ongoing misinformation about modern banks, and show what remains wrong with banking. This book is the voice shouting that the bankers are still not wearing any clothes. We should listen.
-Frank Partnoy, author of Infectious Greed
I like this book. The Bankers’ New Clothes explains in plain language why banking reform is still incomplete, contrary to what lobbyists, politicians, and even some regulators tell us.
-Paul Volcker, former chairman of the U.S. Federal Reserve and the U.S. Economic Recovery Advisory Board
Full chapter after the jump . . .
The Times’s Louise Story talks to Thomas Hoenig, the vice chairman of the Federal Deposit Insurance Corporation, who says he is not alone in calling for a breakup of banks too large to regulate. The five that need to be shrunk JPM, Wells Fargo, Goldman Sachs, Citigroup, Morgan Stanley (Bank of America was not mentioned int his interview buy was discussed previously):
Is there a single doubt left in your mind? Are you still a believer in Rufus T. Firefly Jamie Dimon as the world’s smartest banker? Is there a scintilla of wonder left in your mind that the giant banks are legitimate? Have you come around to understanding — finally — what some of us have…Read More
The very belated Federal civil suit against Standard & Poors is based on one very specific deal, with an extremely egregious email trail. Looking at the entirety of the crisis, the Credit Rating Agencies (the properly blamed CRA) were major players. Standard & Poor’s and Moody’s as well as the much smaller Fitch ratings agencies…Read More
“It’s a false paradox. The peer group is based on the theory of transferability of talent. But we found that C.E.O. skills are very firm-specific. C.E.O.’s don’t move very often, but when they do, they’re flops.” -Charles M. Elson, director of the John L. Weinberg Center for Corporate Governance at the University of Delaware …Read More