Read It Here First

http://www.futureofcapitalism.com/2009/12/read-it-here-first-27

The Wall Street Journal has a column predicting that 2010 will be "the year of the regulator" and flagging three key issues in the upcoming fight over an overhaul of financial regulations. One battleground, the Journal writes, is "a somewhat obscure provision that would allow the government to give a 10% to 20% haircut to debts owed to a bank's secured creditors in the event of a federal takeover." This battleground is not obscure to readers of FutureOfCapitalism.com; we've been writing about it since back in October and have nicknamed it the Bair-Miller-Moore Haircut. Another issue of contention, the Journal reports, is whether a fund to resolve or bail out failing banks should be funded before or after a bailout. "It also has become a disputed topic between the FDIC's Sheila Bair, who says it gives the government much-lacking flexibility, and Treasury Secretary Timothy Geithner, who says the fund could create 'moral hazard' in the future," the Journal reports. This dispute, too, was reported here on FutureOfCapitalism.com back in October, in a post headlined "Bair Versus Geithner."

by Editor  |  Dec 22, 2009 at 8:55 am Related Topics:  Banking, Capital Markets Regulation, FDIC, Press, Sheila Bair, Timothy Geithner receive the latest by email: subscribe to the free futureofcapitalism.com mailing list