Throwback Thursday: The Best Banking Regulation

Today’s #TBT will look back at the Glass-Steagall Act of 1933. But first… Financial Trust The Chicago Booth/Kellogg School Financial Trust Index is a trust yardstick. Answered by approximately one thousand participants, the Index survey touches topics that range from…

A Too Big to Fail Tale

Overseeing big banks, regulators are faced with a too big to fail tradeoff that began with Glass Steagall and continues today with Dodd Frank.

Deposit Insurance: The Importance of Confidence

Cyprus’s banking crisis made me think of the FDIC sign in my local bank. Located right where I can see it, the reminder inspires confidence. Similarly, on an FDIC web site, they say at the top, “Since the FDIC’s creation in 1933,…

Figuring Out Financial Regulation

Words cannot describe the 2300 pages of the Dodd-Frank Wall Street Reform and Consumer Protection Act. In a way, because it says so much, it tells us very little. Still though, after looking at the bill and several news summaries,…

BP and the Financial Crisis

I suspect that there is an inverse relationship between government’s ability to get regulation right and the length of the legislation. Glass-Steagall was 34 pages long. Recently proposed financial legislation is 3000 pages long. The need for appropriate regulation is…

The Banking Pendulum

As George Bailey in “It’s a Wonderful Life,” Jimmy Stewart faces a bank run.  On his wedding day, hoping to save his bank, George first gives out the bank’s cash and then his honeymoon money to a long, agitated line…