[Underworld]

Have there been any financial reforms as a result of the recent chaos? Like what has been put into place to stop it from happening again? I haven't actually heard anything that would indicate such moves.

Thanks.

 

[Rickson9]

I haven't read anything either, but then again, I don't read about things that have no impact on me. Besides you can't contain the forces of greed and panic anyway; they'll always find a way to destroy the current system.

 

[msimms]

Have there been any financial reforms as a result of the recent chaos? Like what has been put into place to stop it from happening again? I haven't actually heard anything that would indicate such moves.

Thanks.

I read somewhere that US lawmakers may be re-reviewing the Glass-Steagall Act, repealed in 1999 and a big contributor to the US financial crisis.
I haven't really read anything past that so I have nothing else to say. But more information should be out there.

http://en.wikipedia.org/wiki/Glass-Steagall_Act

 

[canadianbanks]

The only answer to the financial problems we have is having a free market. We are as far from a free market economy as it gets, so nothing has been done to mitigate future financial disasters.

 

[The Financial Blogger]

I guess that the best plan for US would be to copy our banking system ;-)
I think they are more concerned about getting out of the economic crisis than legislating... sad...

 

[Underworld]

I thought as much - wide open for Wall Street and the super rich to take more money...

 

[Robillard]

One of the most notable bits of the Glass-Steagall Act was the ban on deposit-taking commercial banks from owning or operating an investment banking/dealing business and vice versa. I really don't see how reinstating the act prior to the financial crisis would have prevented or mitigated it at all. Companies what were engaged solely investment banking/dealing showed themselves to be just as likely to collapse as universal banks (institutions engaged in both commercial and investment banking). Specifically, Bear Stearns, Lehman Brothers, and Merrill Lynch, which specialised in investment banking, were just as, if not more vulnerable than Citigroup, Bank of America and Wachovia.

At the same time, all Canadian banks were engaged in investment banking activities to some degree, yet none of them collapsed or needed to be bailed out. In Europe, almost all of the big banks are universals, yet a number of institutions proved to vulnerable, such as RBS, Fortis and Barlclays.

As I understand it, the major difference between Canadian banks and everyone else's banks was that Canadian banks were much better capitalised, and must less reliant upon wholesale funding in the interbank market. When investors were seriously worried about counterparty risk in the interbank market, they really exacerbated the credit crisis.

 

[dogcom]

Rickson9 said, "I haven't read anything either, but then again, I don't read about things that have no impact on me. Besides you can't contain the forces of greed and panic anyway; they'll always find a way to destroy the current system."


I agree with the second part but I don't think we can ever say that things like this have no impact. If the canadian banks fail there will be an impact if we choose to read about it or not.

 

[Cal]

I know alot of the CDN banks implemented a fee for having an unused LOC open. Which in turn caused alot of people to simply close their LOC's, reducing the banks leverage.

It also caused alot of people to be PO, so most banks dropped the fees.

 

[Berubeland]

I was reading on Bloomberg (article about Lehman's bankrupcy) today that they even relaxed some regulation to allow some of these banks to be "properly capitalized" For instance they were mentioning that the banks were never allowed to pledge depositor's money as security.

So the answer is NO and WORSE

Also read today about the return of the Variable ARM mortgage making a comeback.....

You know at some point you just figure they deserve it except for they who gets it never seems to be the people who create it. But someone deserves it just for pure stupidity