PayThink

With the general push for more capital, liquidity, regulatory knowledge, and tools, the financial sector is safer and more competitive.

Through bitter experience, bond purchasers learned about the moral hazard embedded in private residential mortgage-backed securities and their grossly inadequate legal protections.

Filmmaker Jim Bruce has produced a devastating documentary that uses Fed veterans, such as Peter Fisher, to explain how the central bank pumps up asset bubbles.

Responding to potential enforcement actions has become even more challenging because the number of agencies with concurrent jurisdiction has increased, and the authorities of those agencies have been broadened.

Knee-jerk regulations passed in crisis moments can do more harm than good, but all regulation is a static framework applied to an ongoing, dynamic market. The tensions created are inevitable.

A sharp rise in interest rates could cause customers to cash in CDs they have purchased only 30 to 60 days prior. It should not be easily cost effective to cash any CD prior to maturity.

Fannie Mae and Freddie Mac should be increasing the availability of loans to the most underserved segment of the market: the small rental properties across the country that are naturally affordable.

Incorporating both regulatory capital and economic capital into a unified decision measure allows organizations to better optimize risk/return profiles, facilitate strategic planning and limit setting and define risk appetite.

Electronic payment companies design, build and operate costly networks that provide secure payment transactions to merchants. Such providers incur significant costs for the services they provide and deserve to charge a market-based rate to their customers.

The idea of bringing criminal charges against one of the nation’s larger banks has become untenable. The potential cost in jobs, probable shareholder losses and market turmoil would be horrific.