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On July 12 2013 05:23 JonnyBNoHo wrote:Show nested quote +On July 12 2013 05:14 WolfintheSheep wrote:On July 12 2013 05:01 HunterX11 wrote:On July 12 2013 04:13 Klondikebar wrote:On July 12 2013 04:05 farvacola wrote:A small bipartisan group of U.S. senators on Thursday introduced legislation that would break up Wall Street's megabanks by separating traditional banking activity from riskier financial services.
The bill, called the 21st Century Glass-Steagall Act, has an uncertain future, but it shows some lawmakers' frustration that banks have only continued to grow since the 2007-2009 financial crisis.
"The four biggest banks are now 30 percent larger than they were just five years ago, and they have continued to engage in dangerous, high-risk practices that could once again put our economy at risk," said Democratic Senator Elizabeth Warren from Massachusetts, one of the sponsors of the bill.
The other sponsors are Republican Senator John McCain from Arizona, Democratic Senator Maria Cantwell from Washington, and Senator Angus King, an independent from Maine who caucuses with the Senate's Democrats.
The legislation would bring back elements of the 1933 Glass-Steagall Act, which divided commercial and investment banking, and was repealed in 1999.
There were calls to bring back Glass-Steagall immediately after the financial crisis, but the 2010 Dodd-Frank financial reform law stopped short of busting up companies and instead curtails Wall Street's risk-taking.
The debate was revived last year when Sanford "Sandy" Weill, the tycoon who built financial conglomerate Citigroup Inc into a massive U.S. commercial and investment bank, said it was time to split up the biggest banks so they can get back to growing.
The legislation introduced on Thursday would separate the operations of traditional banks with accounts backed by the Federal Deposit Insurance Corp from riskier activities such as investment banking, insurance, swaps and hedge funds.
It would include a five-year transition period and would call for penalties if companies violated the law.
Other attempts since the financial crisis to bring back Glass-Steagall have not gathered significant momentum. US Senators Introduce Bill to Break Up Megabanks I don't understand why these new laws are necessary. Many of these bankers and firms blatantly committed fraud. But nothing was really investigated and absolutely no one was held accountable. These sweeping regulations will never pass because banks have too much lobbying power. If we actually like...enforced our existing fraud laws, we wouldn't need political theater like this. Even if we threw criminal bankers into jail, that still probably wouldn't prevent another Too Big To Fail scenario. Since bailing out depositors is out of the question in the U.S., our only real options are to break up banks if they get too big, or just consign ourselves to being willing to bail them out in perpetuity. I'm not sure why the assumption is that big banks are an issue. The most stable banks during the recession were in countries that had regulated national banks...much "larger" than any banks in the US. I know capitalism > socialism is the popular phrase to throw around, but if you want a system where banks are competing with each other, than the banks that control the most money are going to be the ones with the best rates and returns...which usually means they're the ones taking the most risk with your money Honestly, you're going to have to pick one: competition or stability. You can't have both when it comes to your financial sectors. What banks are you talking about?
Sweden and Canada are the ones that come immediately to mind. Canada specifically has like...5 banks (?) across the entire country, and they're practically identical in terms of all relevant numbers and rates, but we also have the safest banking system in the world that recovered incredibly fast after the global financial collapses.
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On July 12 2013 05:34 WolfintheSheep wrote:Show nested quote +On July 12 2013 05:23 JonnyBNoHo wrote:On July 12 2013 05:14 WolfintheSheep wrote:On July 12 2013 05:01 HunterX11 wrote:On July 12 2013 04:13 Klondikebar wrote:On July 12 2013 04:05 farvacola wrote:A small bipartisan group of U.S. senators on Thursday introduced legislation that would break up Wall Street's megabanks by separating traditional banking activity from riskier financial services.
The bill, called the 21st Century Glass-Steagall Act, has an uncertain future, but it shows some lawmakers' frustration that banks have only continued to grow since the 2007-2009 financial crisis.
"The four biggest banks are now 30 percent larger than they were just five years ago, and they have continued to engage in dangerous, high-risk practices that could once again put our economy at risk," said Democratic Senator Elizabeth Warren from Massachusetts, one of the sponsors of the bill.
The other sponsors are Republican Senator John McCain from Arizona, Democratic Senator Maria Cantwell from Washington, and Senator Angus King, an independent from Maine who caucuses with the Senate's Democrats.
The legislation would bring back elements of the 1933 Glass-Steagall Act, which divided commercial and investment banking, and was repealed in 1999.
There were calls to bring back Glass-Steagall immediately after the financial crisis, but the 2010 Dodd-Frank financial reform law stopped short of busting up companies and instead curtails Wall Street's risk-taking.
The debate was revived last year when Sanford "Sandy" Weill, the tycoon who built financial conglomerate Citigroup Inc into a massive U.S. commercial and investment bank, said it was time to split up the biggest banks so they can get back to growing.
The legislation introduced on Thursday would separate the operations of traditional banks with accounts backed by the Federal Deposit Insurance Corp from riskier activities such as investment banking, insurance, swaps and hedge funds.
It would include a five-year transition period and would call for penalties if companies violated the law.
Other attempts since the financial crisis to bring back Glass-Steagall have not gathered significant momentum. US Senators Introduce Bill to Break Up Megabanks I don't understand why these new laws are necessary. Many of these bankers and firms blatantly committed fraud. But nothing was really investigated and absolutely no one was held accountable. These sweeping regulations will never pass because banks have too much lobbying power. If we actually like...enforced our existing fraud laws, we wouldn't need political theater like this. Even if we threw criminal bankers into jail, that still probably wouldn't prevent another Too Big To Fail scenario. Since bailing out depositors is out of the question in the U.S., our only real options are to break up banks if they get too big, or just consign ourselves to being willing to bail them out in perpetuity. I'm not sure why the assumption is that big banks are an issue. The most stable banks during the recession were in countries that had regulated national banks...much "larger" than any banks in the US. I know capitalism > socialism is the popular phrase to throw around, but if you want a system where banks are competing with each other, than the banks that control the most money are going to be the ones with the best rates and returns...which usually means they're the ones taking the most risk with your money Honestly, you're going to have to pick one: competition or stability. You can't have both when it comes to your financial sectors. What banks are you talking about? Sweden and Canada are the ones that come immediately to mind. Canada specifically has like...5 banks (?) across the entire country, and they're practically identical in terms of all relevant numbers and rates, but we also have the safest banking system in the world that recovered incredibly fast after the global financial collapses.
Pretty sure a recent Daily Show skit talked about how Canada has had zero banking crises in the span that the U.S. has had 16. Pretty impressive, at least from an American POV.
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Pennsylvania Attorney General Kathleen Kane (D) announced Thursday that she would not defend the state's gay marriage ban against a lawsuit filed by the American Civil Liberties Union.
"I cannot ethically defend the constitutionality of Pennsylvania's version of DOMA as I believe it to be wholly unconstitutional," she said at a press conference at the National Constitution Center in Philadelphia.
The ACLU had named Kane, Gov. Tom Corbett (R) and three other state officials in a lawsuit. The case is being brought by 23 plaintiffs, including 10 LGBT couples, two children of another such couple, and a woman who lost her same-sex partner after 29 years together.
The suit follows the Supreme Court decision declaring the federal Defense of Marriage Act unconstitutional. The ACLU is also challenging same-sex marriage bans in North Carolina and Virginia.
Corbett's office recently said that the governor supports the state's gay marriage ban, which passed the legislature in 1996.
Source
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On July 12 2013 05:05 cLutZ wrote:Show nested quote +On July 12 2013 05:01 HunterX11 wrote:On July 12 2013 04:13 Klondikebar wrote:On July 12 2013 04:05 farvacola wrote:A small bipartisan group of U.S. senators on Thursday introduced legislation that would break up Wall Street's megabanks by separating traditional banking activity from riskier financial services.
The bill, called the 21st Century Glass-Steagall Act, has an uncertain future, but it shows some lawmakers' frustration that banks have only continued to grow since the 2007-2009 financial crisis.
"The four biggest banks are now 30 percent larger than they were just five years ago, and they have continued to engage in dangerous, high-risk practices that could once again put our economy at risk," said Democratic Senator Elizabeth Warren from Massachusetts, one of the sponsors of the bill.
The other sponsors are Republican Senator John McCain from Arizona, Democratic Senator Maria Cantwell from Washington, and Senator Angus King, an independent from Maine who caucuses with the Senate's Democrats.
The legislation would bring back elements of the 1933 Glass-Steagall Act, which divided commercial and investment banking, and was repealed in 1999.
There were calls to bring back Glass-Steagall immediately after the financial crisis, but the 2010 Dodd-Frank financial reform law stopped short of busting up companies and instead curtails Wall Street's risk-taking.
The debate was revived last year when Sanford "Sandy" Weill, the tycoon who built financial conglomerate Citigroup Inc into a massive U.S. commercial and investment bank, said it was time to split up the biggest banks so they can get back to growing.
The legislation introduced on Thursday would separate the operations of traditional banks with accounts backed by the Federal Deposit Insurance Corp from riskier activities such as investment banking, insurance, swaps and hedge funds.
It would include a five-year transition period and would call for penalties if companies violated the law.
Other attempts since the financial crisis to bring back Glass-Steagall have not gathered significant momentum. US Senators Introduce Bill to Break Up Megabanks I don't understand why these new laws are necessary. Many of these bankers and firms blatantly committed fraud. But nothing was really investigated and absolutely no one was held accountable. These sweeping regulations will never pass because banks have too much lobbying power. If we actually like...enforced our existing fraud laws, we wouldn't need political theater like this. Even if we threw criminal bankers into jail, that still probably wouldn't prevent another Too Big To Fail scenario. Since bailing out depositors is out of the question in the U.S., our only real options are to break up banks if they get too big, or just consign ourselves to being willing to bail them out in perpetuity. Depositors are legally entitled to FDIC insurance up to a certain amount per account (over 100k i think).
You're right; it's not actual depositors who lost out, but the banks' debtors and creditors.
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On July 12 2013 05:14 WolfintheSheep wrote:Show nested quote +On July 12 2013 05:01 HunterX11 wrote:On July 12 2013 04:13 Klondikebar wrote:On July 12 2013 04:05 farvacola wrote:A small bipartisan group of U.S. senators on Thursday introduced legislation that would break up Wall Street's megabanks by separating traditional banking activity from riskier financial services.
The bill, called the 21st Century Glass-Steagall Act, has an uncertain future, but it shows some lawmakers' frustration that banks have only continued to grow since the 2007-2009 financial crisis.
"The four biggest banks are now 30 percent larger than they were just five years ago, and they have continued to engage in dangerous, high-risk practices that could once again put our economy at risk," said Democratic Senator Elizabeth Warren from Massachusetts, one of the sponsors of the bill.
The other sponsors are Republican Senator John McCain from Arizona, Democratic Senator Maria Cantwell from Washington, and Senator Angus King, an independent from Maine who caucuses with the Senate's Democrats.
The legislation would bring back elements of the 1933 Glass-Steagall Act, which divided commercial and investment banking, and was repealed in 1999.
There were calls to bring back Glass-Steagall immediately after the financial crisis, but the 2010 Dodd-Frank financial reform law stopped short of busting up companies and instead curtails Wall Street's risk-taking.
The debate was revived last year when Sanford "Sandy" Weill, the tycoon who built financial conglomerate Citigroup Inc into a massive U.S. commercial and investment bank, said it was time to split up the biggest banks so they can get back to growing.
The legislation introduced on Thursday would separate the operations of traditional banks with accounts backed by the Federal Deposit Insurance Corp from riskier activities such as investment banking, insurance, swaps and hedge funds.
It would include a five-year transition period and would call for penalties if companies violated the law.
Other attempts since the financial crisis to bring back Glass-Steagall have not gathered significant momentum. US Senators Introduce Bill to Break Up Megabanks I don't understand why these new laws are necessary. Many of these bankers and firms blatantly committed fraud. But nothing was really investigated and absolutely no one was held accountable. These sweeping regulations will never pass because banks have too much lobbying power. If we actually like...enforced our existing fraud laws, we wouldn't need political theater like this. Even if we threw criminal bankers into jail, that still probably wouldn't prevent another Too Big To Fail scenario. Since bailing out depositors is out of the question in the U.S., our only real options are to break up banks if they get too big, or just consign ourselves to being willing to bail them out in perpetuity. I'm not sure why the assumption is that big banks are an issue. The most stable banks during the recession were in countries that had regulated national banks...much "larger" than any banks in the US. I know capitalism > socialism is the popular phrase to throw around, but if you want a system where banks are competing with each other, than the banks that control the most money are going to be the ones with the best rates and returns...which usually means they're the ones taking the most risk with your money Honestly, you're going to have to pick one: competition or stability. You can't have both when it comes to your financial sectors.
Having regulated national banks besides just the Federal Reserve System and Freddie Mac/Fannie Mae would be another option to deal with TBTF banks, but it's also probably still less politically feasible than breaking up too-large independent banks.
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On July 12 2013 05:38 {CC}StealthBlue wrote:Show nested quote +Pennsylvania Attorney General Kathleen Kane (D) announced Thursday that she would not defend the state's gay marriage ban against a lawsuit filed by the American Civil Liberties Union.
"I cannot ethically defend the constitutionality of Pennsylvania's version of DOMA as I believe it to be wholly unconstitutional," she said at a press conference at the National Constitution Center in Philadelphia.
The ACLU had named Kane, Gov. Tom Corbett (R) and three other state officials in a lawsuit. The case is being brought by 23 plaintiffs, including 10 LGBT couples, two children of another such couple, and a woman who lost her same-sex partner after 29 years together.
The suit follows the Supreme Court decision declaring the federal Defense of Marriage Act unconstitutional. The ACLU is also challenging same-sex marriage bans in North Carolina and Virginia.
Corbett's office recently said that the governor supports the state's gay marriage ban, which passed the legislature in 1996. Source
Is this where the Prop 8 decision becomes relevant? They basically ruled that if you have no legal stake in a law, you can't defend it. So a private group can't come forward to defend this law in the AG's stead? So this challenge will sail through without a hitch?
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On July 12 2013 05:34 WolfintheSheep wrote:Show nested quote +On July 12 2013 05:23 JonnyBNoHo wrote:On July 12 2013 05:14 WolfintheSheep wrote:On July 12 2013 05:01 HunterX11 wrote:On July 12 2013 04:13 Klondikebar wrote:On July 12 2013 04:05 farvacola wrote:A small bipartisan group of U.S. senators on Thursday introduced legislation that would break up Wall Street's megabanks by separating traditional banking activity from riskier financial services.
The bill, called the 21st Century Glass-Steagall Act, has an uncertain future, but it shows some lawmakers' frustration that banks have only continued to grow since the 2007-2009 financial crisis.
"The four biggest banks are now 30 percent larger than they were just five years ago, and they have continued to engage in dangerous, high-risk practices that could once again put our economy at risk," said Democratic Senator Elizabeth Warren from Massachusetts, one of the sponsors of the bill.
The other sponsors are Republican Senator John McCain from Arizona, Democratic Senator Maria Cantwell from Washington, and Senator Angus King, an independent from Maine who caucuses with the Senate's Democrats.
The legislation would bring back elements of the 1933 Glass-Steagall Act, which divided commercial and investment banking, and was repealed in 1999.
There were calls to bring back Glass-Steagall immediately after the financial crisis, but the 2010 Dodd-Frank financial reform law stopped short of busting up companies and instead curtails Wall Street's risk-taking.
The debate was revived last year when Sanford "Sandy" Weill, the tycoon who built financial conglomerate Citigroup Inc into a massive U.S. commercial and investment bank, said it was time to split up the biggest banks so they can get back to growing.
The legislation introduced on Thursday would separate the operations of traditional banks with accounts backed by the Federal Deposit Insurance Corp from riskier activities such as investment banking, insurance, swaps and hedge funds.
It would include a five-year transition period and would call for penalties if companies violated the law.
Other attempts since the financial crisis to bring back Glass-Steagall have not gathered significant momentum. US Senators Introduce Bill to Break Up Megabanks I don't understand why these new laws are necessary. Many of these bankers and firms blatantly committed fraud. But nothing was really investigated and absolutely no one was held accountable. These sweeping regulations will never pass because banks have too much lobbying power. If we actually like...enforced our existing fraud laws, we wouldn't need political theater like this. Even if we threw criminal bankers into jail, that still probably wouldn't prevent another Too Big To Fail scenario. Since bailing out depositors is out of the question in the U.S., our only real options are to break up banks if they get too big, or just consign ourselves to being willing to bail them out in perpetuity. I'm not sure why the assumption is that big banks are an issue. The most stable banks during the recession were in countries that had regulated national banks...much "larger" than any banks in the US. I know capitalism > socialism is the popular phrase to throw around, but if you want a system where banks are competing with each other, than the banks that control the most money are going to be the ones with the best rates and returns...which usually means they're the ones taking the most risk with your money Honestly, you're going to have to pick one: competition or stability. You can't have both when it comes to your financial sectors. What banks are you talking about? Sweden and Canada are the ones that come immediately to mind. Canada specifically has like...5 banks (?) across the entire country, and they're practically identical in terms of all relevant numbers and rates, but we also have the safest banking system in the world that recovered incredibly fast after the global financial collapses.
Right now Canadian banks are riskier than US banks. Canada's housing and credit bubbles are now larger than America's and their banks hold less capital. Their recent out-performance was more due to macro factors affecting Canada's overall economy.
Not sure about Sweden, I'd have to look into that.
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On July 12 2013 05:44 HunterX11 wrote:Show nested quote +On July 12 2013 05:05 cLutZ wrote:On July 12 2013 05:01 HunterX11 wrote:On July 12 2013 04:13 Klondikebar wrote:On July 12 2013 04:05 farvacola wrote:A small bipartisan group of U.S. senators on Thursday introduced legislation that would break up Wall Street's megabanks by separating traditional banking activity from riskier financial services.
The bill, called the 21st Century Glass-Steagall Act, has an uncertain future, but it shows some lawmakers' frustration that banks have only continued to grow since the 2007-2009 financial crisis.
"The four biggest banks are now 30 percent larger than they were just five years ago, and they have continued to engage in dangerous, high-risk practices that could once again put our economy at risk," said Democratic Senator Elizabeth Warren from Massachusetts, one of the sponsors of the bill.
The other sponsors are Republican Senator John McCain from Arizona, Democratic Senator Maria Cantwell from Washington, and Senator Angus King, an independent from Maine who caucuses with the Senate's Democrats.
The legislation would bring back elements of the 1933 Glass-Steagall Act, which divided commercial and investment banking, and was repealed in 1999.
There were calls to bring back Glass-Steagall immediately after the financial crisis, but the 2010 Dodd-Frank financial reform law stopped short of busting up companies and instead curtails Wall Street's risk-taking.
The debate was revived last year when Sanford "Sandy" Weill, the tycoon who built financial conglomerate Citigroup Inc into a massive U.S. commercial and investment bank, said it was time to split up the biggest banks so they can get back to growing.
The legislation introduced on Thursday would separate the operations of traditional banks with accounts backed by the Federal Deposit Insurance Corp from riskier activities such as investment banking, insurance, swaps and hedge funds.
It would include a five-year transition period and would call for penalties if companies violated the law.
Other attempts since the financial crisis to bring back Glass-Steagall have not gathered significant momentum. US Senators Introduce Bill to Break Up Megabanks I don't understand why these new laws are necessary. Many of these bankers and firms blatantly committed fraud. But nothing was really investigated and absolutely no one was held accountable. These sweeping regulations will never pass because banks have too much lobbying power. If we actually like...enforced our existing fraud laws, we wouldn't need political theater like this. Even if we threw criminal bankers into jail, that still probably wouldn't prevent another Too Big To Fail scenario. Since bailing out depositors is out of the question in the U.S., our only real options are to break up banks if they get too big, or just consign ourselves to being willing to bail them out in perpetuity. Depositors are legally entitled to FDIC insurance up to a certain amount per account (over 100k i think). You're right; it's not actual depositors who lost out, but the banks' debtors and creditors.
A well managed bankruptcy is SUPPOSED to screw over creditors who took too much risk (as well as shareholders). That is why the bailouts of banks/auto companies set bad precedents going forward. Stockholders and creditors are supposed to get wiped out.
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On July 12 2013 05:50 JonnyBNoHo wrote:Show nested quote +On July 12 2013 05:34 WolfintheSheep wrote:On July 12 2013 05:23 JonnyBNoHo wrote:On July 12 2013 05:14 WolfintheSheep wrote:On July 12 2013 05:01 HunterX11 wrote:On July 12 2013 04:13 Klondikebar wrote:On July 12 2013 04:05 farvacola wrote:A small bipartisan group of U.S. senators on Thursday introduced legislation that would break up Wall Street's megabanks by separating traditional banking activity from riskier financial services.
The bill, called the 21st Century Glass-Steagall Act, has an uncertain future, but it shows some lawmakers' frustration that banks have only continued to grow since the 2007-2009 financial crisis.
"The four biggest banks are now 30 percent larger than they were just five years ago, and they have continued to engage in dangerous, high-risk practices that could once again put our economy at risk," said Democratic Senator Elizabeth Warren from Massachusetts, one of the sponsors of the bill.
The other sponsors are Republican Senator John McCain from Arizona, Democratic Senator Maria Cantwell from Washington, and Senator Angus King, an independent from Maine who caucuses with the Senate's Democrats.
The legislation would bring back elements of the 1933 Glass-Steagall Act, which divided commercial and investment banking, and was repealed in 1999.
There were calls to bring back Glass-Steagall immediately after the financial crisis, but the 2010 Dodd-Frank financial reform law stopped short of busting up companies and instead curtails Wall Street's risk-taking.
The debate was revived last year when Sanford "Sandy" Weill, the tycoon who built financial conglomerate Citigroup Inc into a massive U.S. commercial and investment bank, said it was time to split up the biggest banks so they can get back to growing.
The legislation introduced on Thursday would separate the operations of traditional banks with accounts backed by the Federal Deposit Insurance Corp from riskier activities such as investment banking, insurance, swaps and hedge funds.
It would include a five-year transition period and would call for penalties if companies violated the law.
Other attempts since the financial crisis to bring back Glass-Steagall have not gathered significant momentum. US Senators Introduce Bill to Break Up Megabanks I don't understand why these new laws are necessary. Many of these bankers and firms blatantly committed fraud. But nothing was really investigated and absolutely no one was held accountable. These sweeping regulations will never pass because banks have too much lobbying power. If we actually like...enforced our existing fraud laws, we wouldn't need political theater like this. Even if we threw criminal bankers into jail, that still probably wouldn't prevent another Too Big To Fail scenario. Since bailing out depositors is out of the question in the U.S., our only real options are to break up banks if they get too big, or just consign ourselves to being willing to bail them out in perpetuity. I'm not sure why the assumption is that big banks are an issue. The most stable banks during the recession were in countries that had regulated national banks...much "larger" than any banks in the US. I know capitalism > socialism is the popular phrase to throw around, but if you want a system where banks are competing with each other, than the banks that control the most money are going to be the ones with the best rates and returns...which usually means they're the ones taking the most risk with your money Honestly, you're going to have to pick one: competition or stability. You can't have both when it comes to your financial sectors. What banks are you talking about? Sweden and Canada are the ones that come immediately to mind. Canada specifically has like...5 banks (?) across the entire country, and they're practically identical in terms of all relevant numbers and rates, but we also have the safest banking system in the world that recovered incredibly fast after the global financial collapses. Right now Canadian banks are riskier than US banks. Canada's housing and credit bubbles are now larger than America's and their banks hold less capital. Their recent out-performance was more due to macro factors affecting Canada's overall economy. Not sure about Sweden, I'd have to look into that.
"Riskier" by what metric?
And you're wrong about holding less capital. Canadian banks hold less percentage of their total capital, but the size and scope of the banks means they hold a solid percentage of the national capital.
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On July 12 2013 06:00 WolfintheSheep wrote:Show nested quote +On July 12 2013 05:50 JonnyBNoHo wrote:On July 12 2013 05:34 WolfintheSheep wrote:On July 12 2013 05:23 JonnyBNoHo wrote:On July 12 2013 05:14 WolfintheSheep wrote:On July 12 2013 05:01 HunterX11 wrote:On July 12 2013 04:13 Klondikebar wrote:On July 12 2013 04:05 farvacola wrote:A small bipartisan group of U.S. senators on Thursday introduced legislation that would break up Wall Street's megabanks by separating traditional banking activity from riskier financial services.
The bill, called the 21st Century Glass-Steagall Act, has an uncertain future, but it shows some lawmakers' frustration that banks have only continued to grow since the 2007-2009 financial crisis.
"The four biggest banks are now 30 percent larger than they were just five years ago, and they have continued to engage in dangerous, high-risk practices that could once again put our economy at risk," said Democratic Senator Elizabeth Warren from Massachusetts, one of the sponsors of the bill.
The other sponsors are Republican Senator John McCain from Arizona, Democratic Senator Maria Cantwell from Washington, and Senator Angus King, an independent from Maine who caucuses with the Senate's Democrats.
The legislation would bring back elements of the 1933 Glass-Steagall Act, which divided commercial and investment banking, and was repealed in 1999.
There were calls to bring back Glass-Steagall immediately after the financial crisis, but the 2010 Dodd-Frank financial reform law stopped short of busting up companies and instead curtails Wall Street's risk-taking.
The debate was revived last year when Sanford "Sandy" Weill, the tycoon who built financial conglomerate Citigroup Inc into a massive U.S. commercial and investment bank, said it was time to split up the biggest banks so they can get back to growing.
The legislation introduced on Thursday would separate the operations of traditional banks with accounts backed by the Federal Deposit Insurance Corp from riskier activities such as investment banking, insurance, swaps and hedge funds.
It would include a five-year transition period and would call for penalties if companies violated the law.
Other attempts since the financial crisis to bring back Glass-Steagall have not gathered significant momentum. US Senators Introduce Bill to Break Up Megabanks I don't understand why these new laws are necessary. Many of these bankers and firms blatantly committed fraud. But nothing was really investigated and absolutely no one was held accountable. These sweeping regulations will never pass because banks have too much lobbying power. If we actually like...enforced our existing fraud laws, we wouldn't need political theater like this. Even if we threw criminal bankers into jail, that still probably wouldn't prevent another Too Big To Fail scenario. Since bailing out depositors is out of the question in the U.S., our only real options are to break up banks if they get too big, or just consign ourselves to being willing to bail them out in perpetuity. I'm not sure why the assumption is that big banks are an issue. The most stable banks during the recession were in countries that had regulated national banks...much "larger" than any banks in the US. I know capitalism > socialism is the popular phrase to throw around, but if you want a system where banks are competing with each other, than the banks that control the most money are going to be the ones with the best rates and returns...which usually means they're the ones taking the most risk with your money Honestly, you're going to have to pick one: competition or stability. You can't have both when it comes to your financial sectors. What banks are you talking about? Sweden and Canada are the ones that come immediately to mind. Canada specifically has like...5 banks (?) across the entire country, and they're practically identical in terms of all relevant numbers and rates, but we also have the safest banking system in the world that recovered incredibly fast after the global financial collapses. Right now Canadian banks are riskier than US banks. Canada's housing and credit bubbles are now larger than America's and their banks hold less capital. Their recent out-performance was more due to macro factors affecting Canada's overall economy. Not sure about Sweden, I'd have to look into that. "Riskier" by what metric? And you're wrong about holding less capital. Canadian banks hold less percentage of their total capital, but the size and scope of the banks means they hold a solid percentage of the national capital.
What does "a solid percentage of the national capital" mean?
Canadian banks are more leveraged than US banks, that's a pretty standard risk measurement.
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On July 12 2013 06:05 JonnyBNoHo wrote:Show nested quote +On July 12 2013 06:00 WolfintheSheep wrote:On July 12 2013 05:50 JonnyBNoHo wrote:On July 12 2013 05:34 WolfintheSheep wrote:On July 12 2013 05:23 JonnyBNoHo wrote:On July 12 2013 05:14 WolfintheSheep wrote:On July 12 2013 05:01 HunterX11 wrote:On July 12 2013 04:13 Klondikebar wrote:On July 12 2013 04:05 farvacola wrote:A small bipartisan group of U.S. senators on Thursday introduced legislation that would break up Wall Street's megabanks by separating traditional banking activity from riskier financial services.
The bill, called the 21st Century Glass-Steagall Act, has an uncertain future, but it shows some lawmakers' frustration that banks have only continued to grow since the 2007-2009 financial crisis.
"The four biggest banks are now 30 percent larger than they were just five years ago, and they have continued to engage in dangerous, high-risk practices that could once again put our economy at risk," said Democratic Senator Elizabeth Warren from Massachusetts, one of the sponsors of the bill.
The other sponsors are Republican Senator John McCain from Arizona, Democratic Senator Maria Cantwell from Washington, and Senator Angus King, an independent from Maine who caucuses with the Senate's Democrats.
The legislation would bring back elements of the 1933 Glass-Steagall Act, which divided commercial and investment banking, and was repealed in 1999.
There were calls to bring back Glass-Steagall immediately after the financial crisis, but the 2010 Dodd-Frank financial reform law stopped short of busting up companies and instead curtails Wall Street's risk-taking.
The debate was revived last year when Sanford "Sandy" Weill, the tycoon who built financial conglomerate Citigroup Inc into a massive U.S. commercial and investment bank, said it was time to split up the biggest banks so they can get back to growing.
The legislation introduced on Thursday would separate the operations of traditional banks with accounts backed by the Federal Deposit Insurance Corp from riskier activities such as investment banking, insurance, swaps and hedge funds.
It would include a five-year transition period and would call for penalties if companies violated the law.
Other attempts since the financial crisis to bring back Glass-Steagall have not gathered significant momentum. US Senators Introduce Bill to Break Up Megabanks I don't understand why these new laws are necessary. Many of these bankers and firms blatantly committed fraud. But nothing was really investigated and absolutely no one was held accountable. These sweeping regulations will never pass because banks have too much lobbying power. If we actually like...enforced our existing fraud laws, we wouldn't need political theater like this. Even if we threw criminal bankers into jail, that still probably wouldn't prevent another Too Big To Fail scenario. Since bailing out depositors is out of the question in the U.S., our only real options are to break up banks if they get too big, or just consign ourselves to being willing to bail them out in perpetuity. I'm not sure why the assumption is that big banks are an issue. The most stable banks during the recession were in countries that had regulated national banks...much "larger" than any banks in the US. I know capitalism > socialism is the popular phrase to throw around, but if you want a system where banks are competing with each other, than the banks that control the most money are going to be the ones with the best rates and returns...which usually means they're the ones taking the most risk with your money Honestly, you're going to have to pick one: competition or stability. You can't have both when it comes to your financial sectors. What banks are you talking about? Sweden and Canada are the ones that come immediately to mind. Canada specifically has like...5 banks (?) across the entire country, and they're practically identical in terms of all relevant numbers and rates, but we also have the safest banking system in the world that recovered incredibly fast after the global financial collapses. Right now Canadian banks are riskier than US banks. Canada's housing and credit bubbles are now larger than America's and their banks hold less capital. Their recent out-performance was more due to macro factors affecting Canada's overall economy. Not sure about Sweden, I'd have to look into that. "Riskier" by what metric? And you're wrong about holding less capital. Canadian banks hold less percentage of their total capital, but the size and scope of the banks means they hold a solid percentage of the national capital. What does "a solid percentage of the national capital" mean? Canadian banks are more leveraged than US banks, that's a pretty standard risk measurement.
What metric are we using here, Tier 1 capital ratios or what?
Capital Ratios
From looking at the rates of Tier 1 capital ratios of various Canadian banks, BMO, TD et cetera, it doesn't seem we are far off from where you are?
RBC Financials Sitting at about 9.1%
ScotiaBank Financials Sitting at about 8.6%
TD Bank Financials Sitting at about 10.8%
I will give you that our ratios are slightly lower than the big banks in America but we are not terribly far off.
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On July 12 2013 06:05 JonnyBNoHo wrote:Show nested quote +On July 12 2013 06:00 WolfintheSheep wrote:On July 12 2013 05:50 JonnyBNoHo wrote:On July 12 2013 05:34 WolfintheSheep wrote:On July 12 2013 05:23 JonnyBNoHo wrote:On July 12 2013 05:14 WolfintheSheep wrote:On July 12 2013 05:01 HunterX11 wrote:On July 12 2013 04:13 Klondikebar wrote:On July 12 2013 04:05 farvacola wrote:A small bipartisan group of U.S. senators on Thursday introduced legislation that would break up Wall Street's megabanks by separating traditional banking activity from riskier financial services.
The bill, called the 21st Century Glass-Steagall Act, has an uncertain future, but it shows some lawmakers' frustration that banks have only continued to grow since the 2007-2009 financial crisis.
"The four biggest banks are now 30 percent larger than they were just five years ago, and they have continued to engage in dangerous, high-risk practices that could once again put our economy at risk," said Democratic Senator Elizabeth Warren from Massachusetts, one of the sponsors of the bill.
The other sponsors are Republican Senator John McCain from Arizona, Democratic Senator Maria Cantwell from Washington, and Senator Angus King, an independent from Maine who caucuses with the Senate's Democrats.
The legislation would bring back elements of the 1933 Glass-Steagall Act, which divided commercial and investment banking, and was repealed in 1999.
There were calls to bring back Glass-Steagall immediately after the financial crisis, but the 2010 Dodd-Frank financial reform law stopped short of busting up companies and instead curtails Wall Street's risk-taking.
The debate was revived last year when Sanford "Sandy" Weill, the tycoon who built financial conglomerate Citigroup Inc into a massive U.S. commercial and investment bank, said it was time to split up the biggest banks so they can get back to growing.
The legislation introduced on Thursday would separate the operations of traditional banks with accounts backed by the Federal Deposit Insurance Corp from riskier activities such as investment banking, insurance, swaps and hedge funds.
It would include a five-year transition period and would call for penalties if companies violated the law.
Other attempts since the financial crisis to bring back Glass-Steagall have not gathered significant momentum. US Senators Introduce Bill to Break Up Megabanks I don't understand why these new laws are necessary. Many of these bankers and firms blatantly committed fraud. But nothing was really investigated and absolutely no one was held accountable. These sweeping regulations will never pass because banks have too much lobbying power. If we actually like...enforced our existing fraud laws, we wouldn't need political theater like this. Even if we threw criminal bankers into jail, that still probably wouldn't prevent another Too Big To Fail scenario. Since bailing out depositors is out of the question in the U.S., our only real options are to break up banks if they get too big, or just consign ourselves to being willing to bail them out in perpetuity. I'm not sure why the assumption is that big banks are an issue. The most stable banks during the recession were in countries that had regulated national banks...much "larger" than any banks in the US. I know capitalism > socialism is the popular phrase to throw around, but if you want a system where banks are competing with each other, than the banks that control the most money are going to be the ones with the best rates and returns...which usually means they're the ones taking the most risk with your money Honestly, you're going to have to pick one: competition or stability. You can't have both when it comes to your financial sectors. What banks are you talking about? Sweden and Canada are the ones that come immediately to mind. Canada specifically has like...5 banks (?) across the entire country, and they're practically identical in terms of all relevant numbers and rates, but we also have the safest banking system in the world that recovered incredibly fast after the global financial collapses. Right now Canadian banks are riskier than US banks. Canada's housing and credit bubbles are now larger than America's and their banks hold less capital. Their recent out-performance was more due to macro factors affecting Canada's overall economy. Not sure about Sweden, I'd have to look into that. "Riskier" by what metric? And you're wrong about holding less capital. Canadian banks hold less percentage of their total capital, but the size and scope of the banks means they hold a solid percentage of the national capital. What does "a solid percentage of the national capital" mean? Canadian banks are more leveraged than US banks, that's a pretty standard risk measurement.
The United States has dozens of banks per State, all with varying degrees of coverage and size, along with whatever Federal banks you might have. Canada has five or six covering the entire country. That means Canadian banks can withstand a much higher percentage of the population withdrawing cash before collapsing.
Also:
http://www.gfmag.com/tools/best-banks/12326-worlds-50-safest-banks-april-2013.html#axzz2Ym0eAkDR
http://www3.weforum.org/docs/WEF_GlobalCompetitivenessReport_2010-11.pdf
Every single individual Canadian bank ranks higher than any in the US. And Canada has been ranked the safest banking system in the world for several years now, ever since the recession.
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WASHINGTON — Democrats in the House are set to unveil their own NASA authorization bill, which unlike a much leaner Republican proposal due to be marked up June 10 would authorize $18.1 billion in spending for 2014 — more than NASA has gotten since 2011.
Compared with the draft proposal unveiled in late June by the Republican leadership of the House Science space subcommittee, the Democratic bill — to be put forth by ranking subcommittee member Rep. Donna Edwards (D-Md.) — would authorize more than $1 billion in additional NASA spending for 2014, according to an official summary of the bill obtained by SpaceNews. But with Republicans controlling the agenda in the House of Representatives, it remains to be seen whether the House Science, Space and Technology Committee’s GOP leadership will give formal consideration to Edwards’ bill.
Edwards’ proposal is similar to the Republican bill in several ways: First, authorized funding for NASA’s Planetary Science Division would rise to about $1.5 billion in 2014, restoring the program to its 2012 level. Likewise, NASA’s Commercial Crew Program would be authorized for $700 million in 2014, exactly what the Republican bill proposes.
The Democrat bill also contains strong support for NASA’s human spaceflight enterprise, which got top billing in the official summary of the bill Edwards is poised to introduce. Edwards said NASA should commit to human exploration of Mars by 2030, a more explicit directive than U.S. President Barack Obama made in 2010, when he canceled the Constellation Moon exploration program and directed NASA to send humans to an astronaut by 2025 in preparation for manned Mars missions sometime in the 2030s.
The similarities between the two bills end there, for the most part.
Source
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On July 12 2013 06:15 TotalBalanceSC2 wrote:Show nested quote +On July 12 2013 06:05 JonnyBNoHo wrote:On July 12 2013 06:00 WolfintheSheep wrote:On July 12 2013 05:50 JonnyBNoHo wrote:On July 12 2013 05:34 WolfintheSheep wrote:On July 12 2013 05:23 JonnyBNoHo wrote:On July 12 2013 05:14 WolfintheSheep wrote:On July 12 2013 05:01 HunterX11 wrote:On July 12 2013 04:13 Klondikebar wrote:I don't understand why these new laws are necessary. Many of these bankers and firms blatantly committed fraud. But nothing was really investigated and absolutely no one was held accountable. These sweeping regulations will never pass because banks have too much lobbying power. If we actually like...enforced our existing fraud laws, we wouldn't need political theater like this. Even if we threw criminal bankers into jail, that still probably wouldn't prevent another Too Big To Fail scenario. Since bailing out depositors is out of the question in the U.S., our only real options are to break up banks if they get too big, or just consign ourselves to being willing to bail them out in perpetuity. I'm not sure why the assumption is that big banks are an issue. The most stable banks during the recession were in countries that had regulated national banks...much "larger" than any banks in the US. I know capitalism > socialism is the popular phrase to throw around, but if you want a system where banks are competing with each other, than the banks that control the most money are going to be the ones with the best rates and returns...which usually means they're the ones taking the most risk with your money Honestly, you're going to have to pick one: competition or stability. You can't have both when it comes to your financial sectors. What banks are you talking about? Sweden and Canada are the ones that come immediately to mind. Canada specifically has like...5 banks (?) across the entire country, and they're practically identical in terms of all relevant numbers and rates, but we also have the safest banking system in the world that recovered incredibly fast after the global financial collapses. Right now Canadian banks are riskier than US banks. Canada's housing and credit bubbles are now larger than America's and their banks hold less capital. Their recent out-performance was more due to macro factors affecting Canada's overall economy. Not sure about Sweden, I'd have to look into that. "Riskier" by what metric? And you're wrong about holding less capital. Canadian banks hold less percentage of their total capital, but the size and scope of the banks means they hold a solid percentage of the national capital. What does "a solid percentage of the national capital" mean? Canadian banks are more leveraged than US banks, that's a pretty standard risk measurement. What metric are we using here, Tier 1 capital ratios or what? Capital RatiosFrom looking at the rates of Tier 1 capital ratios of various Canadian banks, BMO, TD et cetera, it doesn't seem we are far off from where you are? RBC Financials Sitting at about 9.1% ScotiaBank Financials Sitting at about 8.6% TD Bank Financials Sitting at about 10.8% I will give you that our ratios are slightly lower than the big banks in America but we are not terribly far off.
S&P made a nice chart but they unfortunately didn't use exactly the same metric so I'll include some supporting text.
+ Show Spoiler +
U.S. banks' strong recapitalization efforts in recent years have led to declines in leverage. Canadian banks have maintained higher leverage than their U.S. counterparts throughout the decade (see chart 4). We note that regulators in both banking systems have used leverage ratios in their supervisory approach for several years, though in slightly different ways. We are also aware that our definition may vary to that of regulators'.
Link
I'm fine with the idea that leverage ratios are pretty similar. I'm also raising the issue of how risky the lending is (high household leverage and high house prices).
On July 12 2013 06:17 WolfintheSheep wrote:Show nested quote +On July 12 2013 06:05 JonnyBNoHo wrote:On July 12 2013 06:00 WolfintheSheep wrote:On July 12 2013 05:50 JonnyBNoHo wrote:On July 12 2013 05:34 WolfintheSheep wrote:On July 12 2013 05:23 JonnyBNoHo wrote:On July 12 2013 05:14 WolfintheSheep wrote:On July 12 2013 05:01 HunterX11 wrote:On July 12 2013 04:13 Klondikebar wrote:I don't understand why these new laws are necessary. Many of these bankers and firms blatantly committed fraud. But nothing was really investigated and absolutely no one was held accountable. These sweeping regulations will never pass because banks have too much lobbying power. If we actually like...enforced our existing fraud laws, we wouldn't need political theater like this. Even if we threw criminal bankers into jail, that still probably wouldn't prevent another Too Big To Fail scenario. Since bailing out depositors is out of the question in the U.S., our only real options are to break up banks if they get too big, or just consign ourselves to being willing to bail them out in perpetuity. I'm not sure why the assumption is that big banks are an issue. The most stable banks during the recession were in countries that had regulated national banks...much "larger" than any banks in the US. I know capitalism > socialism is the popular phrase to throw around, but if you want a system where banks are competing with each other, than the banks that control the most money are going to be the ones with the best rates and returns...which usually means they're the ones taking the most risk with your money Honestly, you're going to have to pick one: competition or stability. You can't have both when it comes to your financial sectors. What banks are you talking about? Sweden and Canada are the ones that come immediately to mind. Canada specifically has like...5 banks (?) across the entire country, and they're practically identical in terms of all relevant numbers and rates, but we also have the safest banking system in the world that recovered incredibly fast after the global financial collapses. Right now Canadian banks are riskier than US banks. Canada's housing and credit bubbles are now larger than America's and their banks hold less capital. Their recent out-performance was more due to macro factors affecting Canada's overall economy. Not sure about Sweden, I'd have to look into that. "Riskier" by what metric? And you're wrong about holding less capital. Canadian banks hold less percentage of their total capital, but the size and scope of the banks means they hold a solid percentage of the national capital. What does "a solid percentage of the national capital" mean? Canadian banks are more leveraged than US banks, that's a pretty standard risk measurement. The United States has dozens of banks per State, all with varying degrees of coverage and size, along with whatever Federal banks you might have. Canada has five or six covering the entire country. That means Canadian banks can withstand a much higher percentage of the population withdrawing cash before collapsing. Also: http://www.gfmag.com/tools/best-banks/12326-worlds-50-safest-banks-april-2013.html#axzz2Ym0eAkDRhttp://www3.weforum.org/docs/WEF_GlobalCompetitivenessReport_2010-11.pdfEvery single individual Canadian bank ranks higher than any in the US. And Canada has been ranked the safest banking system in the world for several years now, ever since the recession.
There's more than 5 or 6 banks in Canada...
Regardless I don't see why larger = safer (if so then what's wrong with TBTF?). Inter-bank lending and central banks, for the most part, handle that issue.
Just because Canadian banks have been relatively safe in the recent past doesn't mean that they'll be safe in the future! Canadian households used to have less debt than American households. Canadian homes used to be valued reasonably when US homes were in a bubble. That's since reversed.
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On July 12 2013 06:57 JonnyBNoHo wrote:Show nested quote +On July 12 2013 06:15 TotalBalanceSC2 wrote:On July 12 2013 06:05 JonnyBNoHo wrote:On July 12 2013 06:00 WolfintheSheep wrote:On July 12 2013 05:50 JonnyBNoHo wrote:On July 12 2013 05:34 WolfintheSheep wrote:On July 12 2013 05:23 JonnyBNoHo wrote:On July 12 2013 05:14 WolfintheSheep wrote:On July 12 2013 05:01 HunterX11 wrote:On July 12 2013 04:13 Klondikebar wrote:
[quote]
I don't understand why these new laws are necessary. Many of these bankers and firms blatantly committed fraud. But nothing was really investigated and absolutely no one was held accountable. These sweeping regulations will never pass because banks have too much lobbying power. If we actually like...enforced our existing fraud laws, we wouldn't need political theater like this.
Even if we threw criminal bankers into jail, that still probably wouldn't prevent another Too Big To Fail scenario. Since bailing out depositors is out of the question in the U.S., our only real options are to break up banks if they get too big, or just consign ourselves to being willing to bail them out in perpetuity. I'm not sure why the assumption is that big banks are an issue. The most stable banks during the recession were in countries that had regulated national banks...much "larger" than any banks in the US. I know capitalism > socialism is the popular phrase to throw around, but if you want a system where banks are competing with each other, than the banks that control the most money are going to be the ones with the best rates and returns...which usually means they're the ones taking the most risk with your money Honestly, you're going to have to pick one: competition or stability. You can't have both when it comes to your financial sectors. What banks are you talking about? Sweden and Canada are the ones that come immediately to mind. Canada specifically has like...5 banks (?) across the entire country, and they're practically identical in terms of all relevant numbers and rates, but we also have the safest banking system in the world that recovered incredibly fast after the global financial collapses. Right now Canadian banks are riskier than US banks. Canada's housing and credit bubbles are now larger than America's and their banks hold less capital. Their recent out-performance was more due to macro factors affecting Canada's overall economy. Not sure about Sweden, I'd have to look into that. "Riskier" by what metric? And you're wrong about holding less capital. Canadian banks hold less percentage of their total capital, but the size and scope of the banks means they hold a solid percentage of the national capital. What does "a solid percentage of the national capital" mean? Canadian banks are more leveraged than US banks, that's a pretty standard risk measurement. What metric are we using here, Tier 1 capital ratios or what? Capital RatiosFrom looking at the rates of Tier 1 capital ratios of various Canadian banks, BMO, TD et cetera, it doesn't seem we are far off from where you are? RBC Financials Sitting at about 9.1% ScotiaBank Financials Sitting at about 8.6% TD Bank Financials Sitting at about 10.8% I will give you that our ratios are slightly lower than the big banks in America but we are not terribly far off. S&P made a nice chart but they unfortunately didn't use exactly the same metric so I'll include some supporting text. + Show Spoiler +Show nested quote +U.S. banks' strong recapitalization efforts in recent years have led to declines in leverage. Canadian banks have maintained higher leverage than their U.S. counterparts throughout the decade (see chart 4). We note that regulators in both banking systems have used leverage ratios in their supervisory approach for several years, though in slightly different ways. We are also aware that our definition may vary to that of regulators'. LinkI'm fine with the idea that leverage ratios are pretty similar. I'm also raising the issue of how risky the lending is (high household leverage and high house prices). Show nested quote +On July 12 2013 06:17 WolfintheSheep wrote:On July 12 2013 06:05 JonnyBNoHo wrote:On July 12 2013 06:00 WolfintheSheep wrote:On July 12 2013 05:50 JonnyBNoHo wrote:On July 12 2013 05:34 WolfintheSheep wrote:On July 12 2013 05:23 JonnyBNoHo wrote:On July 12 2013 05:14 WolfintheSheep wrote:On July 12 2013 05:01 HunterX11 wrote:On July 12 2013 04:13 Klondikebar wrote:
[quote]
I don't understand why these new laws are necessary. Many of these bankers and firms blatantly committed fraud. But nothing was really investigated and absolutely no one was held accountable. These sweeping regulations will never pass because banks have too much lobbying power. If we actually like...enforced our existing fraud laws, we wouldn't need political theater like this.
Even if we threw criminal bankers into jail, that still probably wouldn't prevent another Too Big To Fail scenario. Since bailing out depositors is out of the question in the U.S., our only real options are to break up banks if they get too big, or just consign ourselves to being willing to bail them out in perpetuity. I'm not sure why the assumption is that big banks are an issue. The most stable banks during the recession were in countries that had regulated national banks...much "larger" than any banks in the US. I know capitalism > socialism is the popular phrase to throw around, but if you want a system where banks are competing with each other, than the banks that control the most money are going to be the ones with the best rates and returns...which usually means they're the ones taking the most risk with your money Honestly, you're going to have to pick one: competition or stability. You can't have both when it comes to your financial sectors. What banks are you talking about? Sweden and Canada are the ones that come immediately to mind. Canada specifically has like...5 banks (?) across the entire country, and they're practically identical in terms of all relevant numbers and rates, but we also have the safest banking system in the world that recovered incredibly fast after the global financial collapses. Right now Canadian banks are riskier than US banks. Canada's housing and credit bubbles are now larger than America's and their banks hold less capital. Their recent out-performance was more due to macro factors affecting Canada's overall economy. Not sure about Sweden, I'd have to look into that. "Riskier" by what metric? And you're wrong about holding less capital. Canadian banks hold less percentage of their total capital, but the size and scope of the banks means they hold a solid percentage of the national capital. What does "a solid percentage of the national capital" mean? Canadian banks are more leveraged than US banks, that's a pretty standard risk measurement. The United States has dozens of banks per State, all with varying degrees of coverage and size, along with whatever Federal banks you might have. Canada has five or six covering the entire country. That means Canadian banks can withstand a much higher percentage of the population withdrawing cash before collapsing. Also: http://www.gfmag.com/tools/best-banks/12326-worlds-50-safest-banks-april-2013.html#axzz2Ym0eAkDRhttp://www3.weforum.org/docs/WEF_GlobalCompetitivenessReport_2010-11.pdfEvery single individual Canadian bank ranks higher than any in the US. And Canada has been ranked the safest banking system in the world for several years now, ever since the recession. There's more than 5 or 6 banks in Canada... Regardless I don't see why larger = safer (if so then what's wrong with TBTF?). Inter-bank lending and central banks, for the most part, handle that issue. Just because Canadian banks have been relatively safe in the recent past doesn't mean that they'll be safe in the future! Canadian households used to have less debt than American households. Canadian homes used to be valued reasonably when US homes were in a bubble. That's since reversed.
That chart is total bollocks, they go and use Tier 1 capital for U.S. banks but use Tangible Common Equity for Canadian banks? Anyone with half a brain knows TCE will always be a lot lower than Tier 1 since you can't include preferred shares in TCE calculations, not to mention there is a whole lot of fancy financial instruments banks use to make Tier 1 appear higher that I don't believe would be included in TCE.
TCE Info
"A less commonly used measure is Tangible Common Equity (TCE), which includes only common shares. Obviously, TCE will yield a lower percentage than Tier 1."
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On July 12 2013 07:06 TotalBalanceSC2 wrote:Show nested quote +On July 12 2013 06:57 JonnyBNoHo wrote:On July 12 2013 06:15 TotalBalanceSC2 wrote:On July 12 2013 06:05 JonnyBNoHo wrote:On July 12 2013 06:00 WolfintheSheep wrote:On July 12 2013 05:50 JonnyBNoHo wrote:On July 12 2013 05:34 WolfintheSheep wrote:On July 12 2013 05:23 JonnyBNoHo wrote:On July 12 2013 05:14 WolfintheSheep wrote:On July 12 2013 05:01 HunterX11 wrote:
[quote]
Even if we threw criminal bankers into jail, that still probably wouldn't prevent another Too Big To Fail scenario. Since bailing out depositors is out of the question in the U.S., our only real options are to break up banks if they get too big, or just consign ourselves to being willing to bail them out in perpetuity. I'm not sure why the assumption is that big banks are an issue. The most stable banks during the recession were in countries that had regulated national banks...much "larger" than any banks in the US. I know capitalism > socialism is the popular phrase to throw around, but if you want a system where banks are competing with each other, than the banks that control the most money are going to be the ones with the best rates and returns...which usually means they're the ones taking the most risk with your money Honestly, you're going to have to pick one: competition or stability. You can't have both when it comes to your financial sectors. What banks are you talking about? Sweden and Canada are the ones that come immediately to mind. Canada specifically has like...5 banks (?) across the entire country, and they're practically identical in terms of all relevant numbers and rates, but we also have the safest banking system in the world that recovered incredibly fast after the global financial collapses. Right now Canadian banks are riskier than US banks. Canada's housing and credit bubbles are now larger than America's and their banks hold less capital. Their recent out-performance was more due to macro factors affecting Canada's overall economy. Not sure about Sweden, I'd have to look into that. "Riskier" by what metric? And you're wrong about holding less capital. Canadian banks hold less percentage of their total capital, but the size and scope of the banks means they hold a solid percentage of the national capital. What does "a solid percentage of the national capital" mean? Canadian banks are more leveraged than US banks, that's a pretty standard risk measurement. What metric are we using here, Tier 1 capital ratios or what? Capital RatiosFrom looking at the rates of Tier 1 capital ratios of various Canadian banks, BMO, TD et cetera, it doesn't seem we are far off from where you are? RBC Financials Sitting at about 9.1% ScotiaBank Financials Sitting at about 8.6% TD Bank Financials Sitting at about 10.8% I will give you that our ratios are slightly lower than the big banks in America but we are not terribly far off. S&P made a nice chart but they unfortunately didn't use exactly the same metric so I'll include some supporting text. + Show Spoiler +U.S. banks' strong recapitalization efforts in recent years have led to declines in leverage. Canadian banks have maintained higher leverage than their U.S. counterparts throughout the decade (see chart 4). We note that regulators in both banking systems have used leverage ratios in their supervisory approach for several years, though in slightly different ways. We are also aware that our definition may vary to that of regulators'. LinkI'm fine with the idea that leverage ratios are pretty similar. I'm also raising the issue of how risky the lending is (high household leverage and high house prices). On July 12 2013 06:17 WolfintheSheep wrote:On July 12 2013 06:05 JonnyBNoHo wrote:On July 12 2013 06:00 WolfintheSheep wrote:On July 12 2013 05:50 JonnyBNoHo wrote:On July 12 2013 05:34 WolfintheSheep wrote:On July 12 2013 05:23 JonnyBNoHo wrote:On July 12 2013 05:14 WolfintheSheep wrote:On July 12 2013 05:01 HunterX11 wrote:
[quote]
Even if we threw criminal bankers into jail, that still probably wouldn't prevent another Too Big To Fail scenario. Since bailing out depositors is out of the question in the U.S., our only real options are to break up banks if they get too big, or just consign ourselves to being willing to bail them out in perpetuity. I'm not sure why the assumption is that big banks are an issue. The most stable banks during the recession were in countries that had regulated national banks...much "larger" than any banks in the US. I know capitalism > socialism is the popular phrase to throw around, but if you want a system where banks are competing with each other, than the banks that control the most money are going to be the ones with the best rates and returns...which usually means they're the ones taking the most risk with your money Honestly, you're going to have to pick one: competition or stability. You can't have both when it comes to your financial sectors. What banks are you talking about? Sweden and Canada are the ones that come immediately to mind. Canada specifically has like...5 banks (?) across the entire country, and they're practically identical in terms of all relevant numbers and rates, but we also have the safest banking system in the world that recovered incredibly fast after the global financial collapses. Right now Canadian banks are riskier than US banks. Canada's housing and credit bubbles are now larger than America's and their banks hold less capital. Their recent out-performance was more due to macro factors affecting Canada's overall economy. Not sure about Sweden, I'd have to look into that. "Riskier" by what metric? And you're wrong about holding less capital. Canadian banks hold less percentage of their total capital, but the size and scope of the banks means they hold a solid percentage of the national capital. What does "a solid percentage of the national capital" mean? Canadian banks are more leveraged than US banks, that's a pretty standard risk measurement. The United States has dozens of banks per State, all with varying degrees of coverage and size, along with whatever Federal banks you might have. Canada has five or six covering the entire country. That means Canadian banks can withstand a much higher percentage of the population withdrawing cash before collapsing. Also: http://www.gfmag.com/tools/best-banks/12326-worlds-50-safest-banks-april-2013.html#axzz2Ym0eAkDRhttp://www3.weforum.org/docs/WEF_GlobalCompetitivenessReport_2010-11.pdfEvery single individual Canadian bank ranks higher than any in the US. And Canada has been ranked the safest banking system in the world for several years now, ever since the recession. There's more than 5 or 6 banks in Canada... Regardless I don't see why larger = safer (if so then what's wrong with TBTF?). Inter-bank lending and central banks, for the most part, handle that issue. Just because Canadian banks have been relatively safe in the recent past doesn't mean that they'll be safe in the future! Canadian households used to have less debt than American households. Canadian homes used to be valued reasonably when US homes were in a bubble. That's since reversed. That chart is total bollocks, they go and use Tier 1 capital for U.S. banks but use Tangible Common Equity for Canadian banks? Anyone with half a brain knows TCE will always be a lot lower than Tier 1 since you can't include preferred shares in TCE calculations, not to mention there is a whole lot of fancy financial instruments banks use to make Tier 1 appear higher that I don't believe would be included in TCE. TCE Info"A less commonly used measure is Tangible Common Equity (TCE), which includes only common shares. Obviously, TCE will yield a lower percentage than Tier 1."
I know, that's why I included the text and pointed out that it wasn't the same.
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On July 12 2013 06:57 JonnyBNoHo wrote:
There's more than 5 or 6 banks in Canada...
Regardless I don't see why larger = safer (if so then what's wrong with TBTF?). Inter-bank lending and central banks, for the most part, handle that issue.
Just because Canadian banks have been relatively safe in the recent past doesn't mean that they'll be safe in the future! Canadian households used to have less debt than American households. Canadian homes used to be valued reasonably when US homes were in a bubble. That's since reversed.
Okay, saying there's only 5 or 6 was a bit of hyperbole, but for all intents and purposes those 5-6 control the vast majority of the banking industry.
And yeah, Canadian personal debt is on average higher than American, but that's because of a massive drop in the American debt levels and not because of a sudden rise in Canadian debt. It's definitely a major issue, but not nearly analogous to your financial bubble yet.
And to be frank, "they may fail eventually" is hardly a meaningful statement. I don't want to say that the Canadian system is flawless, because it's certainly not, but compared to the US system it has been historically proven to be safer and more stable. That's really not an argument.
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I am not sure if having few banks and having the nationally run is safer or not. I tend to think that in some ways it is good that in the US there are many banks. It can allow for competitive rates for loans . It can also allow for competitive interest rates to be paid. On the other hand, it seems as if there might not be enough checks and balances on the bank. This could explain, in part, how a few years ago, so many people were granted mortgages they could in no way afford.
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On July 12 2013 05:47 Klondikebar wrote:Show nested quote +On July 12 2013 05:38 {CC}StealthBlue wrote:Pennsylvania Attorney General Kathleen Kane (D) announced Thursday that she would not defend the state's gay marriage ban against a lawsuit filed by the American Civil Liberties Union.
"I cannot ethically defend the constitutionality of Pennsylvania's version of DOMA as I believe it to be wholly unconstitutional," she said at a press conference at the National Constitution Center in Philadelphia.
The ACLU had named Kane, Gov. Tom Corbett (R) and three other state officials in a lawsuit. The case is being brought by 23 plaintiffs, including 10 LGBT couples, two children of another such couple, and a woman who lost her same-sex partner after 29 years together.
The suit follows the Supreme Court decision declaring the federal Defense of Marriage Act unconstitutional. The ACLU is also challenging same-sex marriage bans in North Carolina and Virginia.
Corbett's office recently said that the governor supports the state's gay marriage ban, which passed the legislature in 1996. Source Is this where the Prop 8 decision becomes relevant? They basically ruled that if you have no legal stake in a law, you can't defend it. So a private group can't come forward to defend this law in the AG's stead? So this challenge will sail through without a hitch?
Well, the house republicans were allowed to defend DOMA, so I assume that if any part of the government could have standing to defend it. Longer term, I would say that governments should be legally required to at least defend laws in district court. Not defending them at all would cause huge issues with people just not defending any law they don't like as a way to get rid of them.
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2nd Worst City in CA8938 Posts
The House narrowly passed a pared-back farm bill Thursday after Republican leaders stripped out the nutrition title — impacting food stamps and local food banks — to win back conservative votes. The 216-208 roll call avoids a repeat of last month’s embarrassing collapse and for the first time in a year will allow House-Senate talks on a final farm package. All but 12 Republicans supported the measure — in contrast with the 62 defections in June. And it was a badly needed, face-saving win for Majority Leader Eric Cantor (R-Va.), whose tactics contributed to last month’s loss and had bet heavily on the new approach to recover. Nonetheless, the decision to jettison the nutrition title breaks with nearly a half century of precedent. And the GOP victory came at a huge political cost, splitting American agriculture and driving a wedge between urban and rural lawmakers who have long worked together on farm legislation. All 196 Democrats voted in opposition, and there was a genuine fury displayed by members of the Congressional Black Caucus, who repeatedly delayed the emotional floor proceedings. The intense partisanship and often tone-deaf management of the past month have fed into doubts in Cantor’s own party over his temperament as a would-be speaker. “Farm bills have been bipartisan for generations and we made it a mess,” said one senior Republican. In the process, the GOP gave up precious leverage to enact nutrition reforms in talks with the Senate. And dozens of fiscal conservatives, who complained about the high cost of the farm bill last month, were pressured to switch their votes when the only change was removing food aid for the poor. “This is a victory for farmers and conservatives who desired desperately needed reforms to these programs,” Cantor said in a statement. But a solid phalanx of outside groups, like the Heritage Foundation, Club for Growth and Taxpayers for Common Sense, remained opposed to the level of commodity and crop insurance subsides in the bill. Significant reforms are made, including the termination of direct cash payments to producers. But the 10-year cost is $195.6 billion, and the commodity title goes much further than the Senate in using government-set target prices as a safety net for farmers. Read more at: http://www.politico.com/story/2013/07/farm-bill-2013-house-passes-94031.html?hp=t3_3
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EPT![[image loading]](http://www.standardandpoors.com/spf/fgr_articles/1034111/7182384.gif)
