Fixing finance

Fixing finance:

Will the 'Volcker Rule' Do Anything?
Simon Johnson, Economix, January 26, 2010
The extent of the new bank proposal pitched by the White House last week to limit the size of banks and restrict their activities may be underwhelming, an economist writes.
http://economix.blogs.nytimes.com/2010/01/26/will-the-volcker-rule-do-anything/

How to bypass populism and tackle banking
Arthur Levitt, Financial Times, January 25, 2010
A ban on proprietary trading would have virtually no impact on the risk-taking that caused most bank losses, writes Arthur Levitt.
http://www.ft.com/cms/s/0/619c30d2-09f1-11df-8b23-00144feabdc0.html

A better way to reduce financial sector risk
Raghuram Rajan, Financial Times, January 25, 2010
Rather than limit the size or activity of banks, why not phase out deposit insurance as deposits grow beyond a certain size, suggests Raghuram Rajan.
http://www.ft.com/cms/s/0/63a3bb52-09f1-11df-8b23-00144feabdc0.html


Too interconnected to fail = too big to fail?
Daniel Gros, Vox EU, January 26, 2010
Did allowing financial institutions to become "too big" play a role in the financial crisis? This column argues that being "too interconnected" is also a factor, and that US accounting standards should recognise gross derivatives exposure on the balance sheet to make this interconnectedness, and the resulting exposure, clear.
http://www.voxeu.org/index.php?q=node/4524

Congress Is Politicizing the Fed
Richard W. Fisher, Wall Street Journal, January 25, 2010
The assault on Ben Bernanke is part of a larger trend that is undermining the central bank's independence.http://online.wsj.com/article/SB10001424052748703808904575025042648895592.html?mod=rss_opinion_main