Perhaps the FDIC is reading this blog.
It took a week, but yesterday Sheila C. Bair, the new head of the FDIC, re-stated the argument our argument on banks: Instead of stepping in to support institutions "too big to fail," the government should not allow firms to get that big in the first place. Ms. Bair testified to Congress that current regulation places too much risk on the financial system, and that the Congress proposed idea of a "systemic risk regulatory" will be inadequate to change that level of risk.
The other concern is that Congress' current proposal will lead to the creation of a massive regulatory body which will increase beauracracy and red tape, but no fundamental change in the nature of the risks. Not everyone in her audience got it - hopefully they will soon.
Go Sheila - we are with you.
See today's article in the NY Times:
http://www.nytimes.com/2009/03/20/business/economy/20regulate.html?dlbk
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