‘More robust’ regulation needed for Wall Street firms: Bernanke

AFP
Tuesday, July 8, 2008

Federal Reserve chairman Ben Bernanke called Tuesday for legislation to provide “more robust” supervision of Wall Street investment firms to help avert crises like the one that felled Bear Stearns.

Bernanke, speaking to a forum on mortgage lending, said regulatory loopholes helped precipitate the crisis in the US housing sector that spread to banks and investment firms that financed real estate speculation.

“The enormous losses and writedowns taken at financial institutions around the world since August, as well as the run on Bear Stearns, show that, in this episode, neither market discipline nor regulatory oversight succeeded in limiting leverage and risk-taking sufficiently to preserve financial stability,” Bernanke said.

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The Fed chief said the central bank was working with the Securities and Exchange Commission as well as a White House working group to help beef up oversight of the financial industry, including investment firms not directly under Fed supervision.

“In the longer term, legislation may be needed to provide a more robust framework for the prudential supervision of investment banks and other large securities dealers,” he said.

“Strong holding company oversight is essential and thus, in my view, the Congress should consider requiring consolidated supervision of those firms, providing the regulator the authority to set standards for capital, liquidity holdings, and risk management.”

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7 Responses to “‘More robust’ regulation needed for Wall Street firms: Bernanke”

1. raleigh Says:
   July 8th, 2008 at 5:31 pm

   The feds meddling is destroying the economy… so the proposed solution… Give the fed total control!!! So much for the fallacy of logic.

2. newfy777 Says:
   July 8th, 2008 at 5:52 pm

   give an illegal private corporation even more power?you got to be kidding/joking..how about lets go back to the law of the land,the constutution,and immediately abolish the fed,and return the republic to an honest money system as per the constitution using gold and silver,the only real money in the world..the government having to borrow money from a illegal private corporation is insane and ridiculous,when the constitution specifically states that the government can coin and print its own interest free money and loan usury free money to the people as well..the money system we have now,makes us all slaves to the federal reserve NWO money master..abolish the fed now and free the slaves!

3. GaryCol Says:
   July 8th, 2008 at 9:05 pm

   How do you regulate against stupidity?
   When you have the whole house of cards called the economy built on credit with no to very little assets to support it eventually you will crash.

   The stock markets of the world have been over priced for about 15 years. Dividend returns (The true yeild of any share) have not kept pace with inflation.

   No money hell let’s just print more is the solution. Yep it has worked in the past so why not now. Pity the rest of the world has woken up.

4. swede1 Says:
   July 8th, 2008 at 11:06 pm

   I agree with you in eliminating the Fed. The last time I called the Fed illegal, the comeback was the ratification of the 16th amendment. I know what ya mean however, that amendment seemed to be Stonewalled into law.

5. swede1 Says:
   July 8th, 2008 at 11:07 pm

   Newfy 777, I agree with you in eliminating the Fed. The last time I called the Fed illegal, the comeback was the ratification of the 16th amendment. I know what ya mean, however; that amendment seemed to be “Stonewalled” into law.

6. Anne Says:
   July 9th, 2008 at 3:43 am

   Well – isn’t this what NWO is all about – taking care of ones own and screwing the peasants? Fist you loose everything and the you must pay for it?

   G.K. Chesterton: “When learned men begin to use their reason, then I generally discover that they haven’t got any.”

7. Finn Says:
   July 9th, 2008 at 4:15 am

   I read in a Norwegian online economics publication that the infamous Sub-Prime loans have been re-named, and are now called Re-remics… Anyone heard about it?