Posts Tagged ‘too big to fail’
November 17, 2013
The Senate Banking Committee’s hearing for Janet Yellen’s Fed Chair nomination taught us several things:
1. The Senators should be applauded for dealing with Ms. Yellen in a dignified manner and allowing substance to prevail over theatrics. The questions were about issues of importance, and as I wrote on reading the Wednesday afternoon release of her prepared testimony, heavily oriented on the issue of the Fed’s regulatory responsibility. Yellen made it clear in her response on the issue of the FED‘s policy on deflating ASSET BUBBLES that monetary policy was too blunt an instrument.
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Tags:asset bubbles, Bundesbank, ECB, Elizabeth Warren, Fed, Gold, Janet Yellen, Jens Weidmann, QE, too big to fail
Posted in Equity, Fed | 11 Comments »
July 21, 2013
This weekend brought the results of two days of meetings of the financial ministers and central banks chiefs from the 20 “most significant” economies. The purpose of this visit to Russia was to set the agenda for the September G-20 meeting in St. Petersburg. Reuters posted a piece, “Text–Closing Communique From G20 finance Ministers Meeting,” which filters the results of two days discussions to seven main points. It is a WORTHLESS effort as the communique is filled with diplomatic language that assuages the egos and policies of every participant. The finance leaders OUGHT TO BE EMBARRASSED to release this nonsense. From Reuters:
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Tags:Bernanke, capital regulation, Elizabeth Warren, Fed, G-20, Japan, labor, manufacturing, MBS, Obama administration, QE, too big to fail, Treasury, Yen
Posted in Banks, Fed, G-20, Japan, United States | 12 Comments »
May 14, 2012
LETTERS TO THE EDITOR – Profit centres too big to fail.
By YRA HARRIS.
30 August 2002
Financial Times
(c) 2002 The Financial Times Limited. All rights reserved
Sir, John Plender (“How banks got in a mix”, August 21) correctly identifies the systemic dangers that accompanied the passage of the Graham-Leach-Bliley act. The repeal of Glass-Steagall has pushed the US banking system to the brink of “moral hazard”. The conglomeration of all financial services under one roof has entangled banks in numerous ethical conflicts. Additionally, Graham-Leach-Bliley has made several institutions so large that the Fed cannot allow them to fail.
A single institution’s deep involvement in every facet of financial dealings does not create greater synergy but greater risk. These large, private profit centres know they are too big to collapse. This realisation adds great uncertainty to the entire financial landscape. Rewarding private profits while socialising the risk is a pathway to disaster. Glass-Steagall should never have been repealed without a bank forfeiting its right to Federal Deposit Insurance Corp insurance.
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Tags:Bernanke, FDIC insurance, Fed, fiscal cliff, Glass-Steagall, Goldman Sachs, Jamie Dimon, JPMorgan, portfolio balance channel, systemic cliff, too big to fail
Posted in Banks, United States | 13 Comments »
July 19, 2011
In Monday’s Financial Times there is a column by Lawrence Summers, the GODFATHER of U.S. economic policy. Mr. Summers offers the Europeans a great deal of advice on “HOW TO SAVE THE EUROZONE IN THE COMING CRITICAL WEEKS.” The article is actually a good policy prospective if there was not the issue of politics that play a large and important role in the EU‘s inability to resolve its fiscal difficulties. Summers wants to believe that the EUROCRATS have the political mandate to negotiate Brussel’s desire for a peaceful, state-supported EDEN of entitlements.
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Tags:30-year bond, BOC, Bunds, Canadian Dollar, Commodities, ECB, ethanol, Eurocrats, Gang of Six, German Constitutional Court, Italian bonds, Larry Summers, Mark Warner, notes, philosopher kings, risk-on, Saxby Chambliss, too big to fail, Treasuries, wheat
Posted in Canada, Commodities, Debt Market, Europe, United States | 4 Comments »