Martin Lowy

Policymakers speak of expanding consumer choice, but for the vast majority of borrowers and investors, standardizing choices that make the most financial sense has greater merit.

Using stress tests as the capital benchmark in a reformed regulatory system could enable some forms of relief, but other rules should remain in place to ensure financial stability.

The House proposal establishes a 10% leverage ratio as the standard for bank strength, but it says nothing about the riskiness of the bank’s business or the size of its exposure to economic downturns.