Barry Ritholtz proposes ten “EZ” steps for preventing the next bank crisis which although they may be “EZ” will probably not prove easy. Here are the first three:
1. Depression era Glass Steagall legislation needs to be restored (it was repealed in 1998). Separating FDIC deposit banks with much riskier Wall Street iBanks and speculators is imperative.
2. The Commodity Futures Modernization Act of 2000 needs to be repealed, (Those opposed to this repeal should be deported).
3. Rating agencies need to have their official SEC charters revoked. If they want to sell ratings, they need to do so in the marketplace, not by regulatory mandate.
Read the whole thing. At first glance I can’t tell whether these will be sufficient but they appear to me to be necessary. While #10 is probably the most obvious it will probably also produce the most pushback.
(Those opposed to this repeal should be deported.)
LMAO!
Yeah, Ritholtz is a card.
Not sure what Glass-Steagall would have done to help prevent, mitigate or anything else with regards to a financial crisis. I know lots of people like to point to it, but I don’t think it would have done much if anything at all.
Explain to me how Glass-Steagall would have prevented Lehman Brothers from going insolvent?
I see nothing in regards to allowing for bankruptcy of any kind.
Stupid list.
It did let commercial banks trade MBS and create SIVS, IIRC.
Steve