dagblog - Comments for "WAG THE BANKS"

Volcker's story in this

we are stardust — Fri, 07 Jan 2011 15:32:33 +0000

Volcker's story in this administration has been a tragedy. He was so completely marginalized by the Third Way economic team early on that he quit going to work and stayed home to work on his own. The only time Obama needed him was after Scott Brown's election, and he trotted him out to announce his administration would back a 'modified' version of 'the Vocker Rule (re-instating Glass-Steagall'. ("the only ting between you and the pitchforks is me" or whatever...

Once Volcker had a mike, he was schooled about going 'too far' with the rule, and being 'dangerous to the creation of profits in the bsuiness community'. Further joint appearances showed Obama's hand up Volcker's back, operating him as his Ventriloquist's Dummy.

His allegedy quote above doesn't make much sense, it seems to be arguing in two different directions. People like William Black do know how resolution trust is supposed to work. Now Volcker may really mean he doesn't know how any of it will work with this bunch, given this Fed Chair, this Treasury Secretary, this FDIC. At least some pressure is being brought to bear on them by State Attorneys General, citizens groups, and a few keen judges around the country.

There are indications even Sheila Bair may be getting a little religion on the fraudulent mortgages disaster.

All the best to you, Mr. Volcker; sorry you were used so cavalierly by the administration.

also too:Jan. 7, 2011, 12:01

artappraiser — Fri, 07 Jan 2011 07:45:23 +0000

In reply to Recently, Volcker raised

also too:

Jan. 7, 2011, 12:01 a.m. EST

Stress test redux: Return of bank dividends

Banks seeking to hike dividends must submit capital to the Fed by Friday @

http://www.marketwatch.com/story/stress-test-redux-return-of-bank-divide...

Recently, Volcker raised

artappraiser — Fri, 07 Jan 2011 07:42:09 +0000

In reply to WAG THE BANKS

Recently, Volcker raised concerns about the implementation of a key provision of the bank reform statute designed to limit the collateral damage from a mega-bank failure.

The former central banker, speaking to reporters from an event at the American Enterprise Institute, was talking about an element of Dodd-Frank knows as “resolution authority” that seeks to dismantle a failing big bank that’s deemed to be so big or so interconnected that if it collapsed suddenly it would threaten the economy’s stability.

“I worry about everything, I’m a worrier. Everyone talks about resolution authority which is really a key. Nobody knows quite how it’s going to work. Nobody will know until it is tested, but there are several problems,” Volcker said in December. “We want to get greater international consistency. It’s not up to the U.S. alone.”

In the event of an impending implosion, the mechanism would use U.S. taxpayer dollars to make partial payments to “healthy” creditors and counterparties of the failing firm so that they wouldn’t go down with it.

from

Jan. 6, 2011, 2:39 p.m. EST

Volcker to step down as Obama adviser @

http://www.marketwatch.com/story/volcker-to-step-down-as-obama-advisor-2...

Well I thought that if

artappraiser — Mon, 03 Jan 2011 19:28:34 +0000

In reply to Artsy, just got back to my

Well I thought that if nothing else, he's got a couple nice charts for you.

BTW, I don't expect much response from dumping links on people's old threads. I figure maybe some day in the future when the person checks their history/tracking, they find a nice surprise. Meanwhile, it helps me remember the thread as a place where a lot of stuff on topic has been rounded up, and I can find a reference there if I am discussing it elsewhere, so it's selfish in a way.

Artsy, just got back to my

Oxy Mora — Mon, 03 Jan 2011 19:22:09 +0000

In reply to Floyd Norris makes an

Artsy, just got back to my computer. Thanks very much for the reference. It ties into my next bank diatribe--I have only just begun to fight to break up the mega banks!

Floyd Norris makes an

artappraiser — Fri, 31 Dec 2010 13:40:54 +0000

In reply to WAG THE BANKS

Floyd Norris makes an interesting point today on the long-term systemic change thingie:

....there is one lesson that has been overlooked: Just as big league baseball teams need a farm system to provide replacements for players who age or are injured, a banking system needs a second tier of institutions that can step in and become major league banks if necessary....

During the financial reform

Oxy Mora — Thu, 30 Dec 2010 04:52:33 +0000

In reply to As far as I've heard, Basel

During the financial reform debate Geithner argued that capital requirements should be referred to Basel III instead of being put into Dodd-Frank. Then the IIF, a bank lobbying group convinced central bankers and governments that capital requirements would be contractionary and impede recovery.

Simon Johnson and others have shown that the contractionary arguments are ill founded.

Thanks, Artsy. Any new rules

Oxy Mora — Thu, 30 Dec 2010 04:30:31 +0000

In reply to Their world is already

Thanks, Artsy. Any new rules would presumably emanate from the Basel Committees. As I understand it the Basel III new capital requirements have already been approved by the G-20. These were watered down because of strong bank lobbying against higher requirements on the claim that they would be contractionary and would reduce lending. (This logic has been substantially debunked by a number of economists )The Swiss have increased the basic capital requirements for its two biggest banks to about 10% plus they've instituted other buffers which would put the captial ratio at 19% of assets by 2018--all of which exceeds the Basel III capital rules by a large measure.

I understood Cave to say that the U.S. is pushing the idea of "Resolution Plans" in the Basel Committees. Presumably that would have some impact on cross border banks.

As far as I've heard, Basel

we are stardust — Thu, 30 Dec 2010 01:41:52 +0000

In reply to Their world is already

As far as I've heard, Basel II attendees were waiting for this country to take the lead; it didn't.

Their world is already

artappraiser — Wed, 29 Dec 2010 23:29:00 +0000

In reply to WAG THE BANKS

Their world is already globalized, is part of the problem:

designing rules to tackle large cross-border banks is harder: it probably requires most of the world’s developed economies to introduce new rules. That will take years.

http://www.nytimes.com/2010/12/28/business/28views.html