Comments on: Geithner vs. Congress on bank leverage

By: polit2k

polit2k — Mon, 05 Apr 2010 15:13:12 +0000

It’s as much to do with timing as substance. Remember that the concept as always after a credit crisis is to have taxpayers subsidise banks until the economy recovers enough for them to clean up their balance sheets. So not until the cabal of central bankers agree that the nut has been cracked will the politicians be allowed to bring into force legislation to reform the financial system. Will the markets will give them enough time and how much investors will reduce lending to a more regulated financial system at the same time increase investments in economically beneficial non-financial enterprises?

By: steamboatbill

steamboatbill — Sun, 04 Apr 2010 16:51:43 +0000

There is at least one answer to Geithner: force high capitalization and greater regulation for domestic activities (such as deposit-taking), and allow foreign subsidiaries largely free-rein. It may be necessary to explicitly disallow cross-guarantees, cross-collateralization and the like (and attempt to render ENRON-like contingent equity liabilities unenforceable), but if a bank (or bank-like entity) wishes to be foolish with its shareholders’ funds, let them go for it. Banks have always failed, and will continue to. The domestic economy merely requires that depositors not have to spend all their waking moments worrying about the safety of those deposits, leaving them free to concentrate on getting and spending.

By: Woltmann

Woltmann — Sat, 03 Apr 2010 11:29:33 +0000

Geithner’s whole purpose of being is to run interference for the Financial Industry. He is not on the side of the American taxpayer, he is not in favor of true finacial reform, in short he is not a regulator. He is a shill for the banking industry. Anybody who thinks otherwise is a complete idiot.

By: love91

love91 — Fri, 02 Apr 2010 23:11:10 +0000

If they don’t get rid of proprietary trading, the congressional regulation will be worth squat

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