Comments on: Regulation reform hints of “Old Europe”

By: Anubis

Anubis — Sun, 21 Jun 2009 15:17:19 +0000

Steve, your observations are absolutely correct. I would submit that the deadwood and dim bulbs exist in much of corporate America’s leadership. I fear even Heracles would avoid the task of cleaning up this mess.

By: gd

gd — Sun, 21 Jun 2009 02:20:14 +0000

Only one regulaion needed to solve any future investment crises, regardless of the flavour ie bonds, property or equities. Any financial advicer, banker etc that offers investments over 5% pa must take all the downside of that investment. Problem solved no more specuative bubbles because the sprukers will loss their pants on the downside. Sounds like commonsense, therefore it will never happen!

By: Steve

Steve — Fri, 19 Jun 2009 17:36:15 +0000

You will remember that there was a massive failure by the banking regulators, including the Fed, leading up to this crisis. More spineless regulation is not a solution!!

I am a former senior bank regulator. Please let me offer the following comments:

1. The bank regulators had the authority to examine any aspect of a bank’s activities. They had the authority to figure out what was going on at the banks and to limit it. The regulators did nothing. So creating yet another regulatory bureaucracy will mean nothing if the regulators cannot or will not do their jobs.

2. There are dim bulbs and deadwood at the top of the agencies and all of it needs to be cleaned out. A Herculean task if there ever was one.

3. We recently saw the regulators “stress-test” the major banks and compute the additional capital that the banks required to weather the economic turmoil. Then some of the largest banks complained vociferously about the additional capital requirements and the regulators backed off.