Economist: Dodd-Frank Has Created a ‘Path of Least Resistance’ for Bank Bailouts

[Stephanie]

lovely. yet some you put your complete trust in these elected idiots...ObamaCare ANYONE?

SNIP:


A flailing strategy for too-big-to-fail.



by
Rodrigo Sermeño
May 7, 2014 - 11:07 pm




WASHINGTON – A group of top economists said a law intended to prevent future bailouts for big banks has only institutionalized the practice, while failing to address the problems that led to the financial crisis of 2008.

The 2010 Dodd-Frank legislation mandated hundreds of major regulations to control risky financial activities, with the aim of preventing a repeat of the taxpayer bailouts of “too big to fail” financial institutions.





Many experts have concluded that Dodd-Frank has worsened the too-big-to-fail problem by expanding capital requirements that contributed to the 2008 financial crisis by allowing banks to use arbitrary measures of risk, leading them to hold capital that did not have the same loss-absorbing capacity as equity. Since the late 1980s, federal regulators have required banks to hold a certain amount of capital (such as equity) based on the amount of money they lend to customers and the securities they hold (the bank’s assets). These rules are intended to force banks to build a cushion against unexpected losses.

Charles Calomiris, an economics professor at Columbia University’s Graduate School of Business, said Dodd-Frank has established an “explicit process” for bailing out a too-big-to-fail institution.

“Unfortunately, Title II of Dodd-Frank institutionalized the bailouts of too-big-to-fail banks rather than avoiding them. It did that because it creates a political path of least resistance for politicians to bail out the large banks,” Calomiris said at a panel hosted by the Heritage Foundation. “In fact, it not only creates the actual process through which that would happen, but even funds it through a special new tax.”

Dodd-Frank’s Title II gives the Treasury Department and the Federal Deposit Insurance Corp. (FDIC) the authority to “liquidate” financial companies. The financial reform law permits bailouts through the law’s resolution authority provision. This bailout would be financed by taxes on surviving banks, and if these funds are insufficient, then by taxpayer money.

ALL of it here
PJ Media » Economist: Dodd-Frank Has Created a ?Path of Least Resistance? for Bank Bailouts

 

[oldfart]

lovely. yet some you put your complete trust in these elected idiots...ObamaCare ANYONE?

SNIP:


A flailing strategy for too-big-to-fail.



by
Rodrigo Sermeño
May 7, 2014 - 11:07 pm




WASHINGTON – A group of top economists said a law intended to prevent future bailouts for big banks has only institutionalized the practice, while failing to address the problems that led to the financial crisis of 2008.

The 2010 Dodd-Frank legislation mandated hundreds of major regulations to control risky financial activities, with the aim of preventing a repeat of the taxpayer bailouts of “too big to fail” financial institutions.





Many experts have concluded that Dodd-Frank has worsened the too-big-to-fail problem by expanding capital requirements that contributed to the 2008 financial crisis by allowing banks to use arbitrary measures of risk, leading them to hold capital that did not have the same loss-absorbing capacity as equity. Since the late 1980s, federal regulators have required banks to hold a certain amount of capital (such as equity) based on the amount of money they lend to customers and the securities they hold (the bank’s assets). These rules are intended to force banks to build a cushion against unexpected losses.

Charles Calomiris, an economics professor at Columbia University’s Graduate School of Business, said Dodd-Frank has established an “explicit process” for bailing out a too-big-to-fail institution.

“Unfortunately, Title II of Dodd-Frank institutionalized the bailouts of too-big-to-fail banks rather than avoiding them. It did that because it creates a political path of least resistance for politicians to bail out the large banks,” Calomiris said at a panel hosted by the Heritage Foundation. “In fact, it not only creates the actual process through which that would happen, but even funds it through a special new tax.”

Dodd-Frank’s Title II gives the Treasury Department and the Federal Deposit Insurance Corp. (FDIC) the authority to “liquidate” financial companies. The financial reform law permits bailouts through the law’s resolution authority provision. This bailout would be financed by taxes on surviving banks, and if these funds are insufficient, then by taxpayer money.

ALL of it here
PJ Media » Economist: Dodd-Frank Has Created a ?Path of Least Resistance? for Bank Bailouts

Do you understand what the words "resolution" and "liquidation" mean in banking law?

 

[Toro]

I have no doubt that if we have another financial crisis, the government will be right there to bail out the banks again.

 

[william the wie]

Dodd-Frank was created by two politicians who are believed to have used their offices to profit from the financial bubble in a failed last ditch effort to save their political careers. There are problems with the bill. Quelle surprise.

 

[Ahsan558]

It is very good to save from the energy crises.

 

[Quantum Windbag]

lovely. yet some you put your complete trust in these elected idiots...ObamaCare ANYONE?

SNIP:


A flailing strategy for too-big-to-fail.



by
Rodrigo Sermeño
May 7, 2014 - 11:07 pm




WASHINGTON – A group of top economists said a law intended to prevent future bailouts for big banks has only institutionalized the practice, while failing to address the problems that led to the financial crisis of 2008.

The 2010 Dodd-Frank legislation mandated hundreds of major regulations to control risky financial activities, with the aim of preventing a repeat of the taxpayer bailouts of “too big to fail” financial institutions.





Many experts have concluded that Dodd-Frank has worsened the too-big-to-fail problem by expanding capital requirements that contributed to the 2008 financial crisis by allowing banks to use arbitrary measures of risk, leading them to hold capital that did not have the same loss-absorbing capacity as equity. Since the late 1980s, federal regulators have required banks to hold a certain amount of capital (such as equity) based on the amount of money they lend to customers and the securities they hold (the bank’s assets). These rules are intended to force banks to build a cushion against unexpected losses.

Charles Calomiris, an economics professor at Columbia University’s Graduate School of Business, said Dodd-Frank has established an “explicit process” for bailing out a too-big-to-fail institution.

“Unfortunately, Title II of Dodd-Frank institutionalized the bailouts of too-big-to-fail banks rather than avoiding them. It did that because it creates a political path of least resistance for politicians to bail out the large banks,” Calomiris said at a panel hosted by the Heritage Foundation. “In fact, it not only creates the actual process through which that would happen, but even funds it through a special new tax.”

Dodd-Frank’s Title II gives the Treasury Department and the Federal Deposit Insurance Corp. (FDIC) the authority to “liquidate” financial companies. The financial reform law permits bailouts through the law’s resolution authority provision. This bailout would be financed by taxes on surviving banks, and if these funds are insufficient, then by taxpayer money.

ALL of it here
PJ Media » Economist: Dodd-Frank Has Created a ?Path of Least Resistance? for Bank Bailouts

Do you understand what the words "resolution" and "liquidation" mean in banking law?

Do you understand what they mean under Dodd-Frank?

 

[oldfart]

lovely. yet some you put your complete trust in these elected idiots...ObamaCare ANYONE?

SNIP:


A flailing strategy for too-big-to-fail.



by
Rodrigo Sermeño
May 7, 2014 - 11:07 pm




WASHINGTON – A group of top economists said a law intended to prevent future bailouts for big banks has only institutionalized the practice, while failing to address the problems that led to the financial crisis of 2008.

The 2010 Dodd-Frank legislation mandated hundreds of major regulations to control risky financial activities, with the aim of preventing a repeat of the taxpayer bailouts of “too big to fail” financial institutions.





Many experts have concluded that Dodd-Frank has worsened the too-big-to-fail problem by expanding capital requirements that contributed to the 2008 financial crisis by allowing banks to use arbitrary measures of risk, leading them to hold capital that did not have the same loss-absorbing capacity as equity. Since the late 1980s, federal regulators have required banks to hold a certain amount of capital (such as equity) based on the amount of money they lend to customers and the securities they hold (the bank’s assets). These rules are intended to force banks to build a cushion against unexpected losses.

Charles Calomiris, an economics professor at Columbia University’s Graduate School of Business, said Dodd-Frank has established an “explicit process” for bailing out a too-big-to-fail institution.

“Unfortunately, Title II of Dodd-Frank institutionalized the bailouts of too-big-to-fail banks rather than avoiding them. It did that because it creates a political path of least resistance for politicians to bail out the large banks,” Calomiris said at a panel hosted by the Heritage Foundation. “In fact, it not only creates the actual process through which that would happen, but even funds it through a special new tax.”

Dodd-Frank’s Title II gives the Treasury Department and the Federal Deposit Insurance Corp. (FDIC) the authority to “liquidate” financial companies. The financial reform law permits bailouts through the law’s resolution authority provision. This bailout would be financed by taxes on surviving banks, and if these funds are insufficient, then by taxpayer money.

ALL of it here
PJ Media » Economist: Dodd-Frank Has Created a ?Path of Least Resistance? for Bank Bailouts

Do you understand what the words "resolution" and "liquidation" mean in banking law?

Do you understand what they mean under Dodd-Frank?

Actually I do. They are required to periodically provide information needed to break up and sell off all viable parts and liquidate the rest with shareholders getting zip. In cases of bank resolutions, management is usually escorted out of the premises in the first ten minutes. The employees then are gathered for a meeting to learn who will be immediately let go and who will stay for the wind-down.

 

[JakeStarkey]

Neither Stephanie nor QWB have the slightest idea what D-F means, obviously.

 

[Mikeoxenormous]

lovely. yet some you put your complete trust in these elected idiots...ObamaCare ANYONE?

SNIP:


A flailing strategy for too-big-to-fail.



by
Rodrigo Sermeño
May 7, 2014 - 11:07 pm




WASHINGTON – A group of top economists said a law intended to prevent future bailouts for big banks has only institutionalized the practice, while failing to address the problems that led to the financial crisis of 2008.

The 2010 Dodd-Frank legislation mandated hundreds of major regulations to control risky financial activities, with the aim of preventing a repeat of the taxpayer bailouts of “too big to fail” financial institutions.





Many experts have concluded that Dodd-Frank has worsened the too-big-to-fail problem by expanding capital requirements that contributed to the 2008 financial crisis by allowing banks to use arbitrary measures of risk, leading them to hold capital that did not have the same loss-absorbing capacity as equity. Since the late 1980s, federal regulators have required banks to hold a certain amount of capital (such as equity) based on the amount of money they lend to customers and the securities they hold (the bank’s assets). These rules are intended to force banks to build a cushion against unexpected losses.

Charles Calomiris, an economics professor at Columbia University’s Graduate School of Business, said Dodd-Frank has established an “explicit process” for bailing out a too-big-to-fail institution.

“Unfortunately, Title II of Dodd-Frank institutionalized the bailouts of too-big-to-fail banks rather than avoiding them. It did that because it creates a political path of least resistance for politicians to bail out the large banks,” Calomiris said at a panel hosted by the Heritage Foundation. “In fact, it not only creates the actual process through which that would happen, but even funds it through a special new tax.”

Dodd-Frank’s Title II gives the Treasury Department and the Federal Deposit Insurance Corp. (FDIC) the authority to “liquidate” financial companies. The financial reform law permits bailouts through the law’s resolution authority provision. This bailout would be financed by taxes on surviving banks, and if these funds are insufficient, then by taxpayer money.

ALL of it here
PJ Media » Economist: Dodd-Frank Has Created a ?Path of Least Resistance? for Bank Bailouts

When you elect a liberal to run the country, soon that country will be run into the ground. The title of this link is all about Banks to big to Fail, Which Dodd Frank bill was supposed to protect US against that. Well once again, history is going to repeat itself and George Bush has been out of office 7 years now. New Doubts About ‘Too Big to Fail’ Banks Rattle Foundation of Regulations

Shares of large banks have been under pressure, trading at valuations that indicate investors have little faith in the companies’ sprawling business models.

Some mergers-and-acquisitions bankers on Wall Street are privately beginning to conclude that some of the largest banks may break up in the coming years.

liberals are in charge of the same banks that contribute to the election coffers of the liberals who made this mess. That is why Barney Queer Frankfurtereater and Chrissy Doddering idiot have left politics, they know what they created and it WILL come back to haunt them.

,

 

[usmcstinger]

lovely. yet some you put your complete trust in these elected idiots...ObamaCare ANYONE?

SNIP:


A flailing strategy for too-big-to-fail.



by
Rodrigo Sermeño
May 7, 2014 - 11:07 pm




WASHINGTON – A group of top economists said a law intended to prevent future bailouts for big banks has only institutionalized the practice, while failing to address the problems that led to the financial crisis of 2008.

The 2010 Dodd-Frank legislation mandated hundreds of major regulations to control risky financial activities, with the aim of preventing a repeat of the taxpayer bailouts of “too big to fail” financial institutions.









Many experts have concluded that Dodd-Frank has worsened the too-big-to-fail problem by expanding capital requirements that contributed to the 2008 financial crisis by allowing banks to use arbitrary measures of risk, leading them to hold capital that did not have the same loss-absorbing capacity as equity. Since the late 1980s, federal regulators have required banks to hold a certain amount of capital (such as equity) based on the amount of money they lend to customers












and the securities they hold (the bank’s assets). These rules are intended to force banks to build a cushion against unexpected losses.

Charles Calomiris, an economics professor at Columbia University’s Graduate School of Business, said Dodd-Frank has established an “explicit process” for bailing out a too-big-to-fail institution.

“Unfortunately, Title II of Dodd-Frank institutionalized the bailouts of too-big-to-fail banks rather than avoiding them. It did that because it creates a political path of least resistance for politicians to bail out the large banks,” Calomiris said at a panel hosted by the Heritage Foundation. “In fact, it not only creates the actual process through which that would happen, but even funds it through a special new tax.”

Dodd-Frank’s Title II gives the Treasury Department and the Federal Deposit Insurance Corp. (FDIC) the authority to “liquidate” financial companies. The financial reform law permits bailouts through the law’s resolution authority provision. This bailout would be financed by taxes on surviving banks, and if these funds are insufficient, then by taxpayer money.

ALL of it here
PJ Media » Economist: Dodd-Frank Has Created a ?Path of Least Resistance? for Bank Bailouts

 

[usmcstinger]

This Legislation along with Obamacare are the biggest blocks to Job Growth. A Republican President would put a stop to this insanity.

 

[Manonthestreet]

Congress passed a bail-in bill......there will be no more failing......only poorer account holders after their money is seized...for theirown good of course

 

[Picaro]

Big banks got even larger since the bailout; if you think they were 'too big to fail' then just look at them now, too big to fail on steroids, humongous, and still no real reforms passed, either, so they are still doing what they did then for the most part. Now the Fed just gives away money at no interest to keep them afloat, along with most other big businesses.