The banking industry must create sustainable mortgage products that will work for responsible families of modest means. We also need a proactive homeownership policy from the federal government.
The central bank is too big, too leveraged, extremely short-funded and a frequent creator through its interest rate and money-printing actions of gigantic systemic risk.
The bill would replace the misleading risk-based capital system with a straightforward way to determine the true health of an institution, in addition to providing incentives for the largest banks to downsize.
Its important that models for stress-testing be capable of representing the nuances of the questions they are asked to answer. Insights would be lost if models are kept too simple.
Banks, conflicted by moral hazard, will always fight for maximum FDIC coverage at the least possible cost, since the FDIC is ultimately backed by Other Peoples Money.
The Fed should ditch tailored versions of bank-centric rules for ones that build on current nonbank regulation and are informed by comments received in the pending rulemakings.
