July 27, 2017
Created by the...
June 15, 2017
On Monday, the Department of the Treasury issued its first response to the President’s Executive Order 13772 on core principles for regulating the financial system. The first report covers regulation of banks and...
June 7, 2017
April 25, 2017
Major reform of banking and finance regulation could be coming soon to Washington, D.C. Last week President Trump issued a presidential memorandum directing Treasury Secretary Steve Mnuchin to review the process by which companies are designated as systemically important financial institutions (SIFIs), better known as “too big to fail.” My colleague John Berlau commented on the move last week, urging the administration to go even further:
Some firms have embraced this designation [as systemically important], and some have fought it. But this should not matter for public policy, as government in a free market should not target certain firms...
April 13, 2017
This post is the third in a 3-part series on banking regulation and the Glass-Steagall Act. The first two parts are “Lawmakers Should Shun Long-Repealed Bank Restrictions,” and “Glass-Steagall Would Not Have Prevented the Financial Crisis.”
Director of the National Economic Council Gary Cohn (a former Goldman Sachs executive) told Bloomberg TV on Friday that “If we come up with a 21st Century, modern Glass-Steagall, we may be able to tailor regulation for different aspects of the financial markets and different aspects of the financial institutions...
April 12, 2017
February 20, 2017has been confirmed, Treasury Secretary Steven Mnuchin has a lot on his plate. He needs to do what he can administratively to reduce the crushing burden of...
February 7, 2017
Last Friday, the President issued an executive order on what he called “core principles” for regulating the American financial system. They are:
(a) empower Americans to make independent financial decisions and informed choices in the marketplace, save for retirement, and build individual wealth;
(b) prevent taxpayer-funded bailouts;
(c) foster economic growth and vibrant financial markets through more rigorous regulatory impact analysis that addresses systemic risk and market failures, such as moral hazard and information asymmetry;
(d) enable American companies to be competitive with foreign firms in domestic...
January 27, 2017
Our friends at the MacIver Institute in Wisconsin have a new video out on local government budgets and the temptation to spend taxpayer money on questionable “economic development” projects and tourist events like the town of Edgerton’s Harry Potter Festival.
In the end the town Edgerton declined to spend $200,000 to pay for amenities for the festival, and the organizers were free to continue hosting on their own dime.
December 19, 2016
Whole forests have been cut down to print the books written about the financial crisis of 2007/8 and America’s response to it. Far fewer have been written on what’s wrong with the financial system now. Yet there’s a lot wrong with it. Despite historically low interest rates, banks aren’t lending to businesses or individuals, smaller and community banks have had to close or merge, low-income customers have seen free checking accounts disappear and their fees rise. The financial system is dysfunctional and not fit for purpose.
Most of the blame for this can be laid directly at the feet of the Dodd-Frank Act, passed in 2010 supposedly to stop another financial crisis happening by reining in the big banks with regulatory compliance. Yet the effect of the law has been to strengthen the position of the Wall Street banks most at fault for the crisis, while punishing the Main Street...