How many "Five Years On" stories did you read this week? Me too.
Some were boring, but plenty were fascinating takes on what has and hasn't changed since the financial system nearly collapsed in 2008.
Among my favorites was Tuesday's front-page story on Morgan Stanley in the Wall Street Journal.
It was a well-done, interesting account of the company's metamorphosis. I loved the lead.
Here it is:
Morgan Stanley has nearly four million brokerage customers and thousands of corporate and investment clients, but they aren't the top priority these days.
"Your No. 1 client is the government," John J. Mack, Morgan Stanley's chairman and chief executive from 2005 to 2009, told current CEO James Gorman in a recent phone call. Mr. Gorman, who was visiting Washington that day, agreed.
Executives at other systemically important institutions say much the same thing.
It's a sad state of affairs and it can't be good for the long-term health of our financial system or our economy, but the giants have no one to blame but themselves.
Stop breaking the rules and the regulators won't be your biggest priority.
The other story I want to note is the Journal's story on the Volcker Rule.
Talk about making the case for consolidating the regulatory agencies. The story explains in embarrassing detail the childish relationship between banking and securities regulators including refusing to share documents or to travel across town to one another's offices.
But the line that really caught my attention was this one:
"Regulators, faced with their own disagreements, decided at the end of last year to stop meeting with banks, fearing this further clouded their efforts, said people familiar with the matter."
So federal regulators have spent the entire year writing a key rule without input from the people who will have to comply with it? Industry lobbyists get a lot of flack for delaying and diluting Dodd-Frank rules, but the regulators have the final say. They can listen to all sides and then make sound decisions. That's the way it's supposed to work.
Speaking of Dodd-Frank rules, the last chart in this release from Hamilton Place Strategies should make everyone shudder.
The PR firm is trying to make the point that a lot has happened since Dodd-Frank was enacted in 2010. There have been 13,789 pages of rules – more than 15 million words – written by more than 10 agencies. "There is a new rule every 2.8 days," the release notes. The chart breaks the rules down by goal such as consumer protection or systemic risk.
But the depressing thing is, five years on, Dodd-Frank is only 40% complete.
Just extrapolating from what's been done to date, we've still got more than 20,000 pages of rules to come.