Banking :: essays research papers fc

BankingSo very much for That Plan "More than 70% of commercial bank assets be held by organizations that are supervised by at least ii national agencies al more or less half attract the attention of three or quad. Banks perpetrate on average about 14% of their non-interest expense to complying with rules" (Anonymous 88). A patsy can see that brass waste has struck again. This complex spate of regulation, among other things, increases costs and diffuses accountability for policy actions gone awry. The nigh in effect(p) remedy to correct this problem would be to consolidate most of the supervisory responsibilities of the regulatory agencies into one commission. This would reduce costs to both the government and the banks, and would intromit the parts of the agencies not consolidated to take on their direct tasks. ace such intend was introduced by Treasury Secretary Lloyd Bentsen in promenade of 1994. The plan called for folding, into a new independent federa l agency (called the Banking Commission), the regulatory portions of the Office of the Comptroller of the Currency (OCC), the national Reserve Board, the Federal stay put Insurance Corporation (FDIC), and the Office of Thrift Supervision (OTS). This plan would notwithstanding the government $150 to $200 million a year. This would excessively let in the FDIC to concentrate on deposit insurance and the Fed to concentrate on monetary policy (Anonymous 88). Of course this is Washington, not The Land of Oz, so everyone cant be satisfied with this plan. Fed Chairman Alan Greenspan and FDIC Chairman Ricki R. Tigert stick been birdcall opponents of the plan. Greenspan has four major complaints about the plan. First, divorced from the banks, the Fed would find it harder to forestall and make do with financial crises. Second, monetary policy would suffer because the Fed would have slight access to review the banks. Thirdly, a supervisor with no macroeconomic concerns baron be too i nclined to discourage banks from taking risks, slowdown the delivery down. Lastly, creating a single regulator would do away with consequential checks and balances, in the process damaging state bank regulation (Anonymous 88). To issue these criticisms it is undeniable to make clear what the Feds job is. The Fed has three master(prenominal) responsibilities to mark off financial stability, to implement monetary policy, and to oversee a smoothly operation payments system (delivering checks and transferring funds) (Syron 3). The responsibilities of the Fed are linked to the banking system.Banking essays research papers fc BankingSo Much for That Plan "More than 70% of commercial bank assets are held by organizations that are supervised by at least two federal agencies almost half attract the attention of three or four. Banks devote on average about 14% of their non-interest expense to complying with rules" (Anonymous 88). A fool can see that government waste has s truck again. This tangled mess of regulation, among other things, increases costs and diffuses accountability for policy actions gone awry. The most effective remedy to correct this problem would be to consolidate most of the supervisory responsibilities of the regulatory agencies into one agency. This would reduce costs to both the government and the banks, and would allow the parts of the agencies not consolidated to concentrate on their primary tasks. One such plan was introduced by Treasury Secretary Lloyd Bentsen in March of 1994. The plan called for folding, into a new independent federal agency (called the Banking Commission), the regulatory portions of the Office of the Comptroller of the Currency (OCC), the Federal Reserve Board, the Federal Deposit Insurance Corporation (FDIC), and the Office of Thrift Supervision (OTS). This plan would save the government $150 to $200 million a year. This would also allow the FDIC to concentrate on deposit insurance and the Fed to concent rate on monetary policy (Anonymous 88). Of course this is Washington, not The Land of Oz, so everyone cant be satisfied with this plan. Fed Chairman Alan Greenspan and FDIC Chairman Ricki R. Tigert have been vocal opponents of the plan. Greenspan has four major complaints about the plan. First, divorced from the banks, the Fed would find it harder to forestall and deal with financial crises. Second, monetary policy would suffer because the Fed would have less access to review the banks. Thirdly, a supervisor with no macroeconomic concerns might be too inclined to discourage banks from taking risks, slowing the economy down. Lastly, creating a single regulator would do away with important checks and balances, in the process damaging state bank regulation (Anonymous 88). To answer these criticisms it is necessary to make clear what the Feds job is. The Fed has three main responsibilities to ensure financial stability, to implement monetary policy, and to oversee a smoothly functioning payments system (delivering checks and transferring funds) (Syron 3). The responsibilities of the Fed are linked to the banking system.