
Dr. Sanjay Gupta: A Doctor-Approved Guide to the Sun This Summer
Dr. Sanjay Gupta is here with your summer sunlight guide — exactly when it’s safe to soak up some unfiltered sun, how to truly protect…
Thought Leader: Sanjay Gupta
By Sheila Bair (original source Yahoo Finance)
“’Never let a good crisis go to waste,’ Rahm Emmanuel famously said in 2009. As President Obama’s Chief of Staff, he was speaking of the opportunity to achieve meaningful financial reforms in the aftermath of the Great Financial Crisis.
Ironically, big bank lobbyists are now using the Covid-19 crisis to undo those very reforms, cynically claiming deregulation will help banks support the real economy. Their primary target is the leverage ratio, a key measure of financial stability which big banks have long despised because it places hard and fast constraints on their ability to use unstable leverage to generate high returns. Weakening the leverage ratio will reduce the capital resiliency of the banking system, while giving banks incentives to actually reduce lending to artificially boost their capital ratios.
It is generally recognized that a main cause of the 2008-2009 financial crisis was excessive reliance on debt, or “leverage,” by large financial institutions. Central to post-GFC reforms was a strengthening of rules that require banks to fund themselves with a minimum amount of equity capital. There are two sets of requirements: “risk-based” rules which set minimum capital based on the perceived riskiness of a bank’s assets and “leverage ratios,” which do not allow such adjustments. A key disadvantage of risk based requirements is that they are subjective. They failed spectacularly prior to the GFC, when US and European regulators wrongly assumed mortgages and sovereign debt were low risk. The disadvantage of leverage ratios is that they are not risk-adjusted, requiring the same amount of capital against a US Treasury security (which we hope is safe) as a loan to Boeing. Each has strengths and weaknesses, which is why regulators use both.”
Click here to read more
Dr. Sanjay Gupta: A Doctor-Approved Guide to the Sun This Summer
Dr. Sanjay Gupta is here with your summer sunlight guide — exactly when it’s safe to soak up some unfiltered sun, how to truly protect…
Thought Leader: Sanjay Gupta
Erika Ayers Badan Is Now Stirring The Pot At Food52, A Year After Barstool Sports
Erika Ayers Badan has worked for some of the most recognizable brands in media and technology, including Microsoft, AOL and Yahoo. Now, Ayers Badan is,…
Thought Leader: Erika Ayers Badan
Pat Toomey: A Crucial Moment for Crypto Legislation
Smart rules for the new technology can unleash a wave of innovation like the one the 1996 Telecommunications Act fostered for the internet. The internet…
Thought Leader: Pat Toomey