AgentIndustry News

Preventing another bubble meltdown

Future-Proof: Navigate Threats, Seize Opportunities at ICNY 2018 | Jan 22-26 at the Marriott Marquis, Times Square, New York

A major focus of the Obama proposals to redesign the regulatory system is to bring all the major financial institutions that were implicated in the current financial crisis (or might be implicated in the next one) under regulation. These include hedge funds, investment banks and mortgage companies, which have been only loosely regulated. The general presumption seems to be that if all the major categories of firms are regulated, with clear lines of regulatory responsibility, all should be well. But will it? There should be some unease about this presumption, because major banks and thrifts subject to extensive regulation were nonetheless caught up in the crisis. The Citibank and Bank of America holding companies were regulated by the Federal Reserve; the banks themselves were regulated by the Comptroller of the Currency (OCC); and WaMu, IndyMac and Countrywide were regulated by the Office of Thrift Supervision (OTS). The plan is to shift major responsibility for regulating ...