iOS app Android app

Bank Collapse

Will the Fed Kill the Recovery?

Robert Kuttner | Posted 11.08.2013 | Politics
Robert Kuttner

For decades, you could always count on the Federal Reserve to pull the plug on prosperity too soon, seeing ghosts of inflation everywhere. The Fed, responsive as it was to creditors, preferred a dose of recession to any sort of price pressures, especially wage increases. That changed with the regimes of Fed chairmen Alan Greenspan and Ben Bernanke. Greenspan was willing to keep interest rates low because the banks kept getting into difficulty after bouts of speculative excess in the 1980s and '90s and needed the cheap money to rebuild their balance sheets. The ultimate such collapse occurred just five years ago this week, when the crash of Lehman Brothers revealed the rot in the entire system, and one over-leveraged domino after another fell. The Fed, after a somewhat anomalous run as the engine of recovery, seems to be reverting to type. Trouble is, the economy won't cooperate with this scenario. Inflation is nowhere to be seen, and the recovery continues to be weak.

Reset Equity-Risk Formula for Banks

Mark J. Perry and Robert Dell | Posted 10.01.2011 | Business
Mark J. Perry and Robert Dell

A century or more ago, banks were capitalized more like REITs are today, holding equity of at least 30 percent of assets.

Newly-Approved Rule Claws Back Pay Of Those Responsible For Financial Collapse

Posted 09.05.2011 | Business

WASHINGTON (Dave Clarke) - U.S. regulators will be able to snatch back up to two years of Wall Street executives' pay if they are found responsibl...

FDIC Lands Tour Bus And Other Prizes | Posted 05.25.2011 | Business

The financial crisis that popped the real estate bubble and pushed U.S. bank failures to a 17-year high landed the Federal Deposit Insurance Corp. a r...

Large Bank Collapse Projected In US By Former IMF Chief

Reuters | Posted 05.25.2011 | Business

SINGAPORE (Reuters) - The worst of the global financial crisis is yet to come and a large U.S. bank will fail in the next few months as the world's b...