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http://money.cnn.com/2010/05/12/news/economy/Fed_Wall_Street_Reform/index.htm
Today Congress voted "90-9 on Wednesday to strip from the overall reform bill a provision reshaping the Fed as supervisor of only the nation's largest banks." Which does not change the Fed's regulatory power at all, do you think that this is a good thing? Or do we need to change the Fed's regulatory power? Also it seems that Congress wants to tighten the Fed's ability to loan out money in an emergency only allowing loans when "banks need access to credit -- not when banks are insolvent." Thoughts?
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If nothing else, I think this is a good sign because it signals significant change in how our country looks at financial problems. The FED is only one piece of the puzzle, but I think it's good that it won't become a super regulator.
ReplyDeleteI agree, I don't think that they need to be a super regulator. I also agree that we should control their lending!
ReplyDeleteThis article was very interesting. I doubt that Congress will be able to limit the Fed's power in emergency situations. However, I think loaning only in an emergency when banks need access to credit and not when they are insolvent is a great idea. The Fed was setup with the purpose of loaning credit and having them return to a more simple emergency system may reduce the big bank mentality that when money runs out, the bank can simply ask for any amount of money it wants.
ReplyDeleteI agree completely with Matt but I don't think we can read too much into these kind of votes in congress. The legislative process is so nuanced that who knows how this will change the final draft of the legislation to be voted on by congress.
ReplyDeleteI agree with Matt as well that the FED won't be a super regulator. Tommy also brings up a good point that we can't read to much into these votes yet because this is all leading up the actual vote.
ReplyDeleteI agree with the group, this is at least a good sign of change, and power regulation. It is good to see that some changes to the system are being made to the powerful circle between the FED and the big banks.
ReplyDeleteI think this is a good sign for people looking to see that the Fed has less power and control over the financial system. I hope this means that the little guy, as in the small banks, can get a little more focus from the Fed because the power of these big banks is getting a little out of control as we've seen in class all quarter.
ReplyDeleteAlong with what most people said I think this is a good change. The Fed has had way too much power for years now and big banking has gotten too cozy with them because of this. Controlling their lending will give the signal to banks that there isn't an unlimited supply of money they can have access to.
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