According to
Max Keiser, the shadow banking system has become the real banking system. Apparently, banks can disguise bad assets before an audit by creating an off balance sheet SIV (structured investment vehicle). After the audit, the bad debts can be returned to the balance sheet. This process makes banks appear to be healthier than they really are.
So who regulates the shadow banking system? No one right now, but the
FSB (Financial Stability Board) is in the process of creating regulations and transparency for the shadow banking system.
Mark Carney, the Governor of the Bank of Canada, who will soon be the
Governor of the Bank of England, is the chair of the FSB. He is a former Goldman Sachs guy.
We should feel some security in knowing that there is work being done to make more transparent the workings of the shadow banking system which now has about
$67 trillion floating around in it. Use of the shadow banks was instrumental in bringing down the financial system in 2008.
But, who feels comfortable knowing that another Goldman Sachs guy is going to facilitate the regulation of that black hole called the shadow banking system?
From all we know about how Goldman Sachs goes through the revolving door from government into banking and from banking into government, how can the knowledge that Mark Carney, formerly of Goldman Sachs, make us feel that everything is going to be all right? Why should we hope that the outcome will be any better given the same players and the same revolving door? You could look at the
CFTC chaired by Gary Gensler and note that regulations there have been watered down by lobbying from the banks and few of the deadlines have been met.
How can a financial system be reformed if the players who brought it down are now in positions to regulate that same system? The optics are appalling.
Shadow Banking Grows To Incredible $67 Trillion Industry
By Ben Moshinsky, Jim Brunsden - Bloomberg
(Bloomberg)
-- The shadow banking industry has grown to about $67 trillion, $6
trillion bigger than previously thought, leading global regulators to
seek more oversight of financial transactions that fall outside
traditional oversight.
See the whole article
here
he size of the shadow banking system, which includes the activities
of money market funds, monoline insurers and off- balance sheet
investment vehicles, “can create systemic risks” and “amplify market
reactions when market liquidity is scarce,” the Financial Stability
Board said in a report, which utilized more
data
than last year’s probe into the sector.
“Appropriate monitoring and regulatory frameworks for the shadow
banking system needs to be in place to mitigate the build-up of risks,”
the FSB said in the report published on its website.
Read more: http://www.businessinsider.com/shadow-banking-is-67-trillion-industry-2012-11#ixzz2DMAwOzYx
Nov. 19 (
Bloomberg)
-- The shadow banking industry has grown to about $67 trillion, $6
trillion bigger than previously thought, leading global regulators to
seek more oversight of financial transactions that fall outside
traditional oversight.
The size of the shadow banking system, which includes the activities
of money market funds, monoline insurers and off- balance sheet
investment vehicles, “can create systemic risks” and “amplify market
reactions when market liquidity is scarce,” the Financial Stability
Board said in a report, which utilized more
data than last year’s probe into the sector.
“Appropriate monitoring and regulatory frameworks for the shadow
banking system needs to be in place to mitigate the build-up of risks,”
the FSB said in the report published on its website.
Read more:
http://www.businessinsider.com/shadow-banking-is-67-trillion-industry-2012-11#ixzz2DM8ZwUM1
Nov. 19 (
Bloomberg)
-- The shadow banking industry has grown to about $67 trillion, $6
trillion bigger than previously thought, leading global regulators to
seek more oversight of financial transactions that fall outside
traditional oversight.
The size of the shadow banking system, which includes the activities
of money market funds, monoline insurers and off- balance sheet
investment vehicles, “can create systemic risks” and “amplify market
reactions when market liquidity is scarce,” the Financial Stability
Board said in a report, which utilized more
data than last year’s probe into the sector.
“Appropriate monitoring and regulatory frameworks for the shadow
banking system needs to be in place to mitigate the build-up of risks,”
the FSB said in the report published on its website.
Read more:
http://www.businessinsider.com/shadow-banking-is-67-trillion-industry-2012-11#ixzz2DM8ZwUM1
7 COMMENTS:
Surprise surprise (just kidding)
Three Major Central Banks are Now Headed by Former Goldman Sachs Partners
http://www.economicpolicyjournal.com/2012/11/three-major-central-banks-are-now.html
No surprise--just good links and thank you again. I am angry that no one in the mainstream media (including The Globe and Mail) thinks that it is a bad thing to put Goldman Sachs guys in charge of regulation. It is obvious to me. The financial system is just consolidating its triumph over the economy and the government. Harper is helping in the consolidation with his privatization of everything he can think of.
Your welcome Joyce I am sick to death of all the fraud and crony capitalism. Huff Po has another good article you might like to read concerning the bailed out buffoon sticking his nose in again. Jamie Demon is known as O's favorite banker btw
Warren Buffett: Jamie Dimon Is Best Person For Treasury Secretary
http://www.huffingtonpost.com/2012/11/27/warren-buffett-jamie-dimo_n_2197455.html
When Warren Buffett Says Jump, GoldmanCEO Blankfein Asks, "How high?"http://www.economicpolicyjournal.com/2012/10/when-warren-buffett-says-jump-goldman.htmlMore On the Gifting of WaMu to "Obama's Favorite Bankerhttp://www.economicpolicyjournal.com/2009/12/more-on-gifting-of-wamu-to-obamas.htmlObama's Favorite Banker http://www.economicpolicyjournal.com/2009/07/president-obamas-favorite-banker.htmlhttp://www.economicpolicyjournal.com/2010/03/obamas-favorite-banker-gets-billion.html
If Jamie Dimon becomes Treasury Secretary, then the game is over.
Warren sometimes.has something good to say and other times I.don't know where he is coming from. Jamie Dimon is a worse choice then having Geithner.
TIM the Treasury guy ran the Fed Bank of NY but it is JP Morgan through its Chairman that controls it. JP Morgan will always have a seat on the Board of NY FED BANK.
e
That is also one of the major problems we have in our banking system.
It is.controlled.by The Fed, A privately owned corporation whose owners will always stay secret. But the control of the entire.Fed.system is held by the NY fed Bank which has always been controlled by JP Morgan.
No, not game over. Same game, same players same controllers.
The FED is controlled by the Federal Reserve Bank of N. Y. as was set up by Meyer Rothschild, long before Congress actually created it. Rotuschild was the creator of the central banking system. He insured that JP Morgan, who he put into business would always have a seat their.
Until we learn WHO the real owners are of The FED, we will never have control of our economy. We are at the mercy of a FOR PROFIT company - The FED- that we gave all the power to and cannot get it back.
Oh, and don't think Goldman Sachs is not a big player now. They may have even bought into The.Fed - just my opinion.
Warren sometimes.has something good to say and other times I.don't know where he is coming from. Jamie Dimon is a worse choice then having Geithner.
TIM the Treasury guy ran the Fed Bank of NY but it is JP Morgan through its Chairman that controls it. JP Morgan will always have a seat on the Board of NY FED BANK.
e
That is also one of the major problems we have in our banking system.
It is.controlled.by The Fed, A privately owned corporation whose owners will always stay secret. But the control of the entire.Fed.system is held by the NY fed Bank which has always been controlled by JP Morgan.
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