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Bair, a regulator for the people

 In Sheila we trust.

Maybe that should be the new mantra for U.S. taxpayers — especially ones who don’t feel the nation’s bankers have shown sufficient gratitude for being bailed out and saved from their own incompetence and greed.

Sheila Bair, once again, has shown that she may be the one financial regulator who gets it.

The Financial Times is reporting that Bair and the Federal Deposit Insurance Corp took the lead in pushing Citigroup to hire and outside consultant to determine whether the bank’s management team is up to the task of fixing the ailing financial giant.

The consultant is supposed to work with the bank’s board in coming up with a plan for potential management changes by the end of October.

from Rolfe Winkler:

Sheila Bair not cowed by Geithner tantrum, criticizes Obama

Last week Tim Geithner dropped multiple F-bombs in a meeting with regulators unenthusiastic about his plan to concentrate oversight of the financial system at the Fed.  Sheila Bair was one of his targets, but today she held her ground.  In testimony before the Senate Banking Committee this morning, she had this to say about concentrating regulatory power at the Fed:

...we do not see merit or wisdom in consolidating federal supervision of national and state banking charters into a single regulator for the simple reason that the ability to choose between federal and state regulatory regimes played no significant role in the current crisis.

from Rolfe Winkler:

Bair on ending “too-big-to-fail”

FDIC Chairwoman Sheila Bair is right now testifying in front of the Senate Banking Committee on "establishing a framework for systemic risk regulation."  This is of course hugely important.  How do we end "too-big-to-fail?"  And how do we resolve failures that are so big they pose a systemic risk?

There's so much valuable stuff in this testimony, readers should really see all of it.  To help you get through all 30 pages, I've highlighted key passages and provided commentary (in pink italics...I didn't choose pink, btw, Scribd just read my formatting that way!).