A Quote by Stephen A. Schwarzman
In a financial crisis, only the Fed, as the lender of last resort, might stand between our economy and financial catastrophe. We must leave the Fed with the flexibility to provide liquidity in order to stop a financial panic.
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The Fed contributed to the financial crisis, keeping interest rates too low for too long. I give them credit for responding and stabilizing the economy and the financial sector during the crisis. But then they tried to do too much with quantitative easing that went on forever, just dramatically exploding their balance sheets.
Among other objectives, liquidity guidelines must take into account the risks that inadequate liquidity planning by major financial firms pose for the broader financial system, and they must ensure that these firms do not become excessively reliant on liquidity support from the central bank.
Forgive me, I must start by pointing out that three years after our horrific financial crisis caused by financial fraud, not a single financial executive has gone to jail, and that's wrong.
The heart of the 2008 financial crisis was a coterie of reckless financial executives, working for too-big-to-fail financial companies, who were handsomely compensated for taking risks that almost ruined the economy when they failed.
The details of what the Fed did were kept secret until a provision in the Dodd-Frank Act that I sponsored required the Government Accountability Office to audit the Fed's lending programs during the financial crisis.
The financial crisis of 2008 created a seismic shift in the dynamics of trust in financial services. FinTech would have happened without the global financial crisis - but it would have taken much longer.
Fortunately, when Korea was struck by the 1997/8 financial crisis, that was a good opportunity for us to engage in fundamental reforms and strengthen our financial structure. As a result, our financial regulatory structure and regime have been very much strengthened.
Audit the Fed is a bill that would politicize monetary policy, would bring short-term political pressures to bear on the Fed. In terms of openness about our financial accounts, we are extensively audited.
The financial crisis revealed important weaknesses in many areas of our financial system.
I felt that the Fed had always been the agency that picked up the pieces when there was a financial crisis, and it was invented to do exactly that.
To restore confidence in our markets and our financial institutions so they can fuel continued growth and prosperity, we must address the underlying problem. The federal government must implement a program to remove these illiquid assets that are weighing down our financial institutions and threatening our economy.
Anyone interested in the past, present, or future of banking and financial crises should read The Bankers' New Clothes. Admati and Hellwig provide a forceful and accessible analysis of the recent financial crisis and offer proposals to prevent future financial failures. While controversial, these proposals--whether you agree or disagree with them--will force you to think through the problems and solutions.
The Death of Money is an engrossing account of the massive stresses accumulating in the global financial system, especially since the 2008 financial crisis. Jim Rickards is a natural teacher. Any serious student of financial crises and their root causes needs to read this book.
The Fed has a lot of power in the economy because it has a big impact on the supply and cost of credit, that is, interest rates. It also plays a key role in supervising banks and historically has seemed to take it easy on the banks when it shouldn't have, such as in the lead up to the financial crisis.
The rest of the world needs the U.S. economy and financial system to recover in order for it to revive. We remain at the center of global economic activity with financial and trade ties to every region of the globe.
The rest of the world needs the US economy and financial system to recover in order for it to revive. We remain at the center of global economic activity with financial and trade ties to every region of the globe.
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