May 12, 2013 |
It's been five years since the onset of the financial crisis — the rescue of Bear Stearns in March 2008 — and we still don't know whether the financial system is safe. In a recent speech, Daniel Tarullo, the Federal Reserve's point man on regulation, contended that substantial, though incomplete, progress has been made. As an example, he cited the doubling of equity capital for the 18 largest bank holding companies from $393 billion in late 2008 to $792 billion at the end of 2012.
May 10, 2013 |
Federal Reserve Chairman Ben S. Bernanke on Friday defended the central bank's ability to shield the economy from another financial crisis but warned that risks remained in the lightly regulated "shadow banking" system. The Fed is responsible for overseeing individual banks to ensure their safety and soundness, but in recent years it has ramped up its monitoring of an increasingly complex web of financial services. Bernanke said it is now conducting regular stress tests on banks,...
May 3, 2013 |
The Federal Reserve's point man on bank regulation, Daniel Tarullo, is calling for big banks who rely on the debt markets for financing to hold more capital, adding to the growing pressure to rein in megabanks. Tarullo's proposal comes a week after Sens. Sherrod Brown (D-Ohio) and David Vitter (R-La.) introduced legislation to impose higher capital requirements on megabanks to make them safer and less dependent on government bailouts. The ultimate goal of both proposals is the same, but Tarullo is...
April 5, 2013 |
Here's an experiment not to try: Drive down a country road on a moonless night and kill the headlights. Try to navigate only by the dials on your dashboard. How far do you think you'd go without crashing? Depends, right? On how fast you're driving, on how sharply the road twists, on whether there are guardrails lining the shoulder. It makes a huge difference what you've got on your dashboard. Ideally you'd want a GPS and an array of infrared cameras....
April 3, 2013 |
Correction: The name of Rep. Spencer Bachus (R-Ala.) was misspelled in earlier versions of this article. After the 2008 credit crisis nearly wrecked the nation's financial system, few panels in Congress were more instrumental in putting the pieces back together than the House Financial Services Committee. The committee was led then by Rep. Barney Frank (Mass.) , a Democrat who worked with then-ranking Republican Spencer Bachus (Ala.) , as well as the...
March 29, 2013 |
Adapted from "The Alchemists: Three Central Bankers and a World on Fire," by Neil Irwin (The Penguin Press, available April 4). The BlackBerrys all started buzzing, just before dinner was to begin at the Palacio da Bacalhoa, a 15th-century estate outside Lisbon. The 21 men and one woman charged with charting the course of Europe's economy looked down to find startling news that evening of May 6, 2010. Across the Atlantic, the U.S. stock market had plummeted. In only 15 minutes, the Dow Jones...