But, but, but...isn't inflation global??? Isn't that the argument? ROTFLMFAO!! Btw, if Pocahontas says something, it's a safe bet that the opposite is true.Elizabeth Warren Is Right: Jerome Powell Should Be Held to Account
With the Silicon Valley Bank collapse, the senator demands an independent investigation of the Fed, and says Powell should not continue as its chair.
The fallout from the collapse of California’s Silicon Valley Bank continues to rock financial and political circles. There is plenty of finger-pointing and blame-laying going on. But Massachusetts Senator Elizabeth Warren reminds us that a lot more attention needs to be paid to the role that Federal Reserve chair Jerome Powell played in the collapse that continues to shake confidence in the banking system.
In a blistering letter to Powell last week, Warren put things in perspective, arguing with regard to the second-largest bank failure in US history:
The banks’ executives—who took too many risks, and failed to protect their customers—are the primary agents responsible for their failure. But the greed and incompetence of these officials was allowed to happen under your watch. It was allowed to happen because of Congress and President Trump’s weakening of the Dodd-Frank Wall Street Reform and Dodd-Frank Act that you supported. It was allowed to happen because of regulatory rollbacks that you initiated. And it was allowed to happen because of supervisory failures by officials that worked for you. This is an astonishing list of failures and you owe the public an explanation for your actions.
Warren’s complaints come as news reports suggest that the Fed knew of problems at SVB and other banks, with The New York Times explaining, “Silicon Valley Bank’s risky practices were on the Federal Reserve’s radar for more than a year—an awareness that proved insufficient to stop the bank’s demise.”
But the senator is pointing to broader and longer-term concerns regarding Powell’s approach.
Noting that the Fed chair supported 2018’s Economic Growth, Regulatory Relief, and Consumer Protection Act, which eliminated key regulatory requirements for banks with assets of up to $250 billion—such as SVB and another collapsed institution, New York’s Signature Bank—Warren bluntly told Powell in her March 15 letter, “As Chair of the Fed, you have led and vigorously supported efforts to weaken the regulations that would have subjected banks like SVB and Signature to stronger liquidity requirements, more robust stress testing, and routine resolution planning obligations. Make no mistake: your decisions aided and abetted this bank failure, and you bear your share of responsibility for it.”
Amplifying her critique on NBC’s Meet the Press on Sunday, Warren said Powell “took a flamethrower to the regulations” and that, as a consequence, “the CEOs of the banks did exactly what we expected. They loaded up on risk that boosted their short-term profits. They gave themselves huge bonuses and salaries and exploded their banks.”
That’s tough language. But Warren, with her decades-long history of scholarship on the financial services industry and the Fed—as well as her current perch on the Senate Banking Committee—knows whereof she speaks. She’s never been a fan of Powell, who was nominated as Fed chair in 2017 by former President Donald Trump and renominated by President Joe Biden in 2021. But the senator, who once referred to Powell as “a dangerous man,” has stepped up her criticism of the chairman since the bank collapses of earlier this month, and on Sunday declared, “He has had two jobs. One is to deal with monetary policy. One is to deal with regulation. He has failed at both.”
Warren is not Powell’s only critic. Senators Sheldon Whitehouse (D-R.I.) and Jeff Merkley (D-Ore.) encouraged Biden to nominate someone other than Powell for chair in 2021, noting that Powell “refuses to recognize climate change as an urgent and systemic economic threat.” In 2020, during a House Financial Services Committee hearing, Representative Katie Porter (D-Calif.) famously ripped Powell for his coziness with economic elites, following reports that the Fed chair had attended a black-tie event at the Washington home of Amazon billionaire Jeff Bezos along with Trump administration insiders and top bankers. “Can you imagine how attending a lavish party at Jeff Bezos’s $23 million home—along with Jared and Ivanka, and the CEO of JPMorgan Chase, Jamie Dimon—might give off the sense to the public that you are not, in fact, immune from external pressures?” asked Porter.
And, last fall, Representative Ro Khanna (D-Calif.) argued that Powell should apologize for the Fed’s bumbling response to inflation. “I blame the Fed and I blame Powell for mismanaging the situation in the first place,” Khanna said. “He should take accountability that he messed up.”
But Warren has been the loudest critic, and since the SVB collapse, she has made it particularly clear that she thinks Powell should step down. “Look,” she said Sunday. “I don’t think he should be chairman of the Federal Reserve.”
Warren is right: Powell should go. Unfortunately, he’s unlikely to step down and equally unlikely to be removed. His term as chair is not due to end until 2026, and his term as a Federal Reserve Board member is set to last until January 31, 2028. But his tenure can and should face more serious scrutiny.
On March 18, Warren asked the inspectors general at the Department of Treasury, the Federal Deposit Insurance Corporation, and the Board of Governors of the Federal Reserve “to immediately open a thorough, independent investigation of the causes of the bank management and regulatory and supervisory problems that resulted in this month’s failure of Silicon Valley Bank (SVB) and Signature Bank (Signature), and deliver preliminary results to Congress and the public within 30 days.”
Warren has also asked that Powell recuse himself from internal probes by the Fed into the Silicon Valley Bank’s collapse, writing in a March 18 letterto the inspectors general and the Fed board, “It is also critical that your investigation be completely independent and free of influence from the bank executives or regulators that were responsible for action that led to these bank failures. I am particularly concerned that you avoid any interference from Fed Chair Jerome Powell, who bears direct responsibility for—and has a long record of failure involving—regulatory and supervisory matters involving these two banks.”
Elizabeth Warren Is Right: Jerome Powell Should Be Held to Account
With the Silicon Valley Bank collapse, the senator demands an independent investigation of the Fed, and says Powell should not continue as its chair.www.thenation.com
Another Bank collapse! No Wonder why! Meet the Head of investment!
- Thread starter Addict2sex
- Start date
The Pocahontas Dude who is facing indictment? Yes, the opposite is always true in his case. After all the Elections were "Stolen", and that was amplified by the liars from Fox Lies Network (fLIES Network). But then you take their word for it. ROTFLMAO!!
Pocahontas is the nickname for Elisabeth Warren- the fake Indian.
That's right. And the high ratio mortgages were suppose to increase the rates of home ownership among the them.
Where is your proof that their orientation had anything to do with them being hired? And what about the other heads of investment at the other failed financial institutions? Where they trans or gay as well? I mean, the funny thing here is that the right is trying so hard to paint these failings as something to do with "wokeness" and ignore the fact that Trump and his GOP cronies gutted financial regulations back in 2018 that directly lead to these banks making bad bets on the direction of the market.
There is actually a lot that can be said about these failures, mostly about how they all took risky investment positions (similar to 2007/08) and got bailed out when things went bad. Now, I'm not saying the Fed shouldn't have stepped in to ensure these banks didn't collapse, because the systemic shock that could have had would be disastrous for the global economy. But SVB was under Fed supervision when the shit hit the fan...and other big banks say they conducted their own stress tests...which is bullshit.
Now, Canadian banks aren't going to take big hit on this shit because our regulators and laws are stricter, and our institutions are more risk adverse compared to the US.
But, the bottom line is, this financial fiasco has nothing, absolutely NOTHING with the anyones sexual orientation, ESG or DEI initiatives. Anyone who says so has an axe to grind and a huge lack of facts...
I wanna address something I saw in an earlier post. This thread is now massive...The people who think ESG investing is bad....why? Do you even understand what ESG means? I'll break it down to the basics: ESG stands for Environment, Social and Governance.
Environment: Do the company pollute or damage the environment?
Social: Is it a good corporate citizen that treats employees well?
Governance: Are there robust check in place to ensure corporate malfeasance is mitigated or eliminated?
The benefit of investing in companies that have strong ESG policies is that they are less likely to go tits up compared to companies that don't. Look at it from this perspective, would you invest in a company that could face a multi-billion dollar class action lawsuit over a chemical spill? Like Norfolk Souther or BP? Would you want to invest in company that could face lawsuits over systemic sexual harassment (like Activision Blizzard?), or in a company that cooks the books like Enron or purposefully lies to regulators and investors like Volkswagen in 2015 over its claims of "clean" diesel?
The point is, companies that follow ESG principles tend to be better managed companies and turn better profits compared to rivals that do not have them. That is a fact. You can get all dick hurt and call it woke or what ever the fuck you think that means, but the reality is ensuring your business doesn't act like fucking idiot will have benefits in the long term..
Environment: Do the company pollute or damage the environment?
Social: Is it a good corporate citizen that treats employees well?
Governance: Are there robust check in place to ensure corporate malfeasance is mitigated or eliminated?
The benefit of investing in companies that have strong ESG policies is that they are less likely to go tits up compared to companies that don't. Look at it from this perspective, would you invest in a company that could face a multi-billion dollar class action lawsuit over a chemical spill? Like Norfolk Souther or BP? Would you want to invest in company that could face lawsuits over systemic sexual harassment (like Activision Blizzard?), or in a company that cooks the books like Enron or purposefully lies to regulators and investors like Volkswagen in 2015 over its claims of "clean" diesel?
The point is, companies that follow ESG principles tend to be better managed companies and turn better profits compared to rivals that do not have them. That is a fact. You can get all dick hurt and call it woke or what ever the fuck you think that means, but the reality is ensuring your business doesn't act like fucking idiot will have benefits in the long term..
I'm not going to do your home work for you, but you're likely right that the mortgage requirements were lowered to try to get more people into home ownership. In hindsight, we can say it was a bad idea. However, businesses jumped on the bandwagon in the name of profits not social justice. Where were the risk managers then?
By the way, I don't think it's totally fair to blame a single person on this. As I said before, a crisis of that scale takes a whole lot of people making a series of bad decisions over a long period of time.
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Obviously, he doesn't have any proof of this. Not that it would matter because a mountain of proof wouldn't sway him anyway.
Neither would shame, ridicule or scorn.
LOL!! Were you still in grade school at that time?
Phil Gramm and Michael Solon: The Clinton-Era Roots of the Financial Crisis
In The Wall Street Journal, Phil Gramm and Mike Solon write that affordable-housing goals established in the 1990s led to a massive increase in risky, subprime mortgages.
online.wsj.com
Tells me a lot about you when you resort to silly atttacks like this.LOL!! Were you still in grade school at that time?
Phil Gramm and Michael Solon: The Clinton-Era Roots of the Financial Crisis
In The Wall Street Journal, Phil Gramm and Mike Solon write that affordable-housing goals established in the 1990s led to a massive increase in risky, subprime mortgages.
I thought the WSJ and MSM are fake news? Yet here you are using it as a shield. And you couldn't even link to a complete article that isn't behind a paywall. Honestly man, don't waste your time linking another article because you won't read it anyway.
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The Clinton-Era Roots of the Financial Crisis
Affordable-housing goals established in the 1990s led to a massive increase in risky, subprime mortgages.
By Phil Gramm And Mike Solon
Aug. 12, 2013 6:55 pm ET
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Simply put, the financial crisis of 2008 was caused by a lot of banks making a lot of loans to a lot of people who either could not or would not pay the money back. But this explanation raises two key questions. Why did private lenders, whose job it was to assess credit risk, make those loans? And why did the army of financial regulators, with massive enforcement powers, allow 28 million high-risk loans to be made?
There's a strong case that the answers can be traced to Sept. 12, 1992. On that day presidential candidate Bill Clinton proposed, in his campaign book "Putting People First," using private pension funds to "invest" in government priorities, such as affordable housing, to "generate long-term, broad based economic benefits." Seldom has such a radical proposal been so ignored during a campaign only to later lead to such devastating consequences.
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After his election, President Clinton tapped Labor Secretary Robert Reich to lead the effort to extract, as Mr. Reich put it in 1994 congressional testimony, "social, ancillary, economic benefits" from private pension investments. Mr. Reich called on pension funds to join the administration's "Economically Targeted Investment" effort. Housing and Urban Development Secretary Henry Cisneros assured participants that "pension investments in affordable housing are as safe as pension investments in stocks and bonds."
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Six pension funds ultimately agreed to invest in public housing that was backed by $100 million in federal grants and guarantees, but the program never took off. In the end, even unions and their pension funds rejected the effort to direct any part of their retirement savings toward someone else's welfare.
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The Clinton administration lost the battle to use pensions to fund low-income housing, but it succeeded in winning the war by drafting Fannie Mae, Freddie Mac and the commercial banking system into the affordable-housing effort. It did so by exploiting a minor provision in a 1977 housing bill, the Community Reinvestment Act, that simply required banks to meet local credit needs.
Bank regulators began to pressure banks to make subprime loans. Guidelines became mandates as each bank was assigned a letter grade on CRA loans. Banks could not even open ATMs or branches, much less acquire another bank, without a passing grade—and getting a passing grade was no longer about meeting local credit needs. As then-Federal Reserve Chairman Alan Greenspan testified to Congress in 2008, "the early stages of the subprime [mortgage] market . . . essentially emerged out of the CRA."
image
Democratic presidential candidate Bill Clinton in September, 1992.
ILLUSTRATION: AGENCE FRANCE-PRESSE/GETTY IMAGES
Effective in January 1993, the 1992 housing bill required Fannie and Freddie to make 30% of their mortgage purchases affordable-housing loans. The quota was raised to 40% in 1996, 42% in 1997, and in 2000 the Department of Housing and Urban Development ordered the quota raised to 50%. The Bush administration continued to raise the affordable-housing goals. Freddie and Fannie dutifully met those goals each and every year until the subprime crisis erupted. By 2008, when both government-sponsored enterprises collapsed, the quota had reached 56%. An internal Fannie document made public after the financial crisis ("HUD Housing Goals," March 2003) clearly shows that by 2002 Fannie officials knew perfectly well that these quotas were promoting irresponsible policy: "The challenge freaked out the business side of the house [Fannie] . . . the tenseness around meeting the goals meant that we . . . did deals at risks and prices we would not have otherwise done."
The mortgage market shows the dramatic results of this shift in policy. According to the nonprofit National Community Reinvestment Coalition, total CRA lending rose to $4.5 trillion in 2007 from $8 billion in 1991. The American Enterprise Institute's Ed Pinto found that in 1990 80% of the residential mortgage loans acquired by Fannie and Freddie were solid prime loans with healthy down payments and a well-documented capacity by borrowers to make mortgage payments. By 1999 only 45% of their acquisitions met this standard. That number fell to 15% by 2007. By 2008, roughly half of all outstanding mortgages in America were high-risk loans. In 1990, very few subprime loans were securitized. By 2007 almost all of them were.
Everything appeared to work fine as long as accommodative monetary policy and capital inflows from developing countries continued to fuel the upward float of housing prices. Home ownership grew to 69% in 2006 from 64% in 1993, but when monetary policy tightened the housing bubble broke and the mortgage-default rate soared.
It is stunning that, to this day, no one has explained how 28 million high-risk loans (the number calculated by the American Enterprise Institute's Peter Wallison) got around the "safety and soundness" rules that dominate federal and state banking laws. What happened to the enforcement army, with its laws and regulations, its power to investigate and mandate corrective action, and its ability to fine and imprison violators?
The people who destroyed lending standards by driving subprime lending blamed banks, greed and deregulation for causing the financial crisis. But a review of the banking laws adopted since 1980 reveals that not one single safety and soundness measure was repealed.
Whatever went on inside the various agencies, financial regulators—whose job it was to enforce safety and soundness regulations—in the end deferred to government affordable-housing goals. Conflicted laws created conflicted regulations and conflicted regulators. Safety and soundness considerations required that regulators step on the brake. Affordable-housing goals required them to step on the gas. Government policy tried to make private wealth serve both government and private purposes. But wealth cannot serve two masters, and in the end the government was the dominant master.
We all know that is what the Trumpty Dumpty labelled her to be, as she has some connection from a few generations to the Indigenous Community!!
Here you go boys and girls and others. Institutions that were rock solid, pillars of great economies are all unhinged. And all it took was two years of lockdown madness and insane monetary policies. Buy gold and bullets- I hope not.
www.breitbart.com
Deutsche Bank Shares Fall 13% as Fears of Contagion Rise - Breitbart
Frankfurt's Deutsche Bank shares nosedived more than 13 percent on the lender's spiking cost of default cover, or credit default swaps, while peer Commerzbank tumbled by 10 percent. In Paris, Societe Generale shed nearly eight percent and BNP Paribas lost around seven percent in value. And in...
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