This Week in Financial Regulation, August 13th
News and Commentary Matt Stoller has an interesting issue of his BIG newsletter describing the inequality in how the Fed sets interests rates and, more importantly, who gets to borrow [...]
Making Sense of the Barro-Ricardo Equivalence in a Financialized World
The 2008 crisis created a need to rethink many aspects of economic theory, including the role of public intervention in the economy. On this issue, we explore the Barro-Ricardo equivalence, [...]
The Monetary Basis of Bank Supervision
A series of statutory provisions codified at Title 12 of the U.S. Code empower special government officials known as supervisors to examine banks and tell bankers what to do, not [...]
The Value of Intermediation in the Stock Market
Brokers continue to play a critical role in intermediating institutional stock market transactions. More than half of all institutional investor order flow is still executed by high-touch (non-electronic) brokers. Despite [...]
Jumbo rates are below conforming rates: When did this happen and why?
Pre-crisis estimates of the jumbo-conforming spread, utilizing a variety of methodologies, ranged from 10 to 25 basis points. In the post-crisis period, this spread has decreased and has been negative [...]
This Week in Financial Regulation, August 6th
Rent Check Dan Takash has a new post critiquing the regulatory treatment of Contingent Convertible bonds. CoCos function like normal debt until the borrower becomes financially distressed, then the loan [...]
CoCos vs. Comprehensive Regulatory Reform
We’ve previously written about Contingent Convertible (CoCo) bonds as an alternative to traditional debt and a tool to increase financial stability. CoCos are instruments that, while essentially the same as [...]
This Week in Financial Regulation, July 30th
Rent Check I have a blog post examining how the Community Reinvestment Act is inadvertently accelerating gentrification. While it was a needed amelioration for the legacies of redlining, flaws in [...]
Community Replacement Act
Subsidies to homeownership have disfavored renters through regressive regulations, lavishly subsidized bigger homes, and played no small role in the most crippling financial crisis and economic downturn since the Great [...]
This Week in Financial Regulation, July 23rd
News and Commentary In an op-ed for The Hill, Laurence Kotlikoff of Boston University makes the comprehensive case for narrow banking. Much like a mutual fund, it is simply impossible [...]