Category Archives: Regulations and regulators

In Rebuke to Cronyistic New York Fed, TBTF Bank Supervision Shifted to Fed Board of Governors

The Wall Street Journal has published an important account of a behind-the-scenes power struggle at the Federal Reserve over authority for regulation. The result that the New York Fed has had significant amounts of its authority shifted to the Board of Governors in Washington, DC. This is a major win for Fed governor Dan Tarullo, who has emerged as one of the toughest critics of big financial firms at the Fed in the wake of the crisis. It is also a loss for the banks, since the New York Fed is widely recognized as close to Wall Street. Moreover, the Board of Governors is more accountable to citizens (its governors are Federal employees, the Board of Governors is subject to FOIA, although confidential supervisory of all financial regulators is exempt), while the regional Feds can best be thought of as public/private partnerships with weak governance structures,* so this move in theory is also a gain in terms of accountability to the public. However, since Greenspan holdover, deregulation enthusiast and Dodd Frank opponent Scott Alvarez remains as the general counsel of the Board of Governors, it’s unlikely that any newfound serious intent by the Board of Governors will go all that far in practice, given the powerful role that Alvarez exerts over matters regulatory.

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Do Greece, the Troika, and the Eurogroup Actually Have a Deal?

Ambrose Evans-Pritchard has a new article on Greece’s scramble to find the funds to meet it March IMF payments, which are €1.5b in total, with €300 due on Friday. Note that IMF payment dates aren’t as hard and fast as credit card due dates; the agency allows borrowers some leeway if they have a clear intent to pay.

Nevertheless, Evans-Pritchard’s most important observation may be the one at the close of his article:

Whatever piece of paper they signed in Brussels 10 days ago, the two sides are still talking past each other.

In other words, the two sides disagree profoundly as to what the memo means. And that may mean that in reality, there is no deal at all.

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A Grassroots Win: FCC Approves Net Neutrality

Thanks to those Naked Capitalism readers who supported, through your petition signatures, e-mails, calls, and donations, the push to preserve net neutrality and keep the major telecom and cable incumbents from giving preferential access to content providers with the financial heft to pay for it. Over time, that practice would be certain to drive smaller sites like ours into a death spiral of lower attractiveness, lower visibility, and lower traffic.

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ECB and IMF to Greece: No Escaping the Austerity Hairshirt

We warned readers who are still keen to take the Syriza “Hope is coming” slogan as something more promising that a subconscious echo of the Obama 2008 “Hope and change” campaign, that the memo that Greece signed with the Eurogroup last week did not represent a victory or a lessening of austerity. The comments by the ECB and the IMF on the reform list from Greece submitted Monday confirmed our earlier readings, that austerity is still very much on in Greece.

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