September 30

By Roosevelt Institute |

daily-digest-150What you need to know to navigate today’s economic debate.

Senators Reject Pair of Public Option Proposals (NYT)
The Senate Finance Committee rejects two Democratic proposals to create a government insurance plan to compete with private insurers.

Signs of Life in Financial Reform (NYT)
Americans still cannot be sure the new boost of energy to overhaul the financial system will produce real reform.

I.M.F. Calls for Overhaul of Financial System (NYT)
Widely praised Global Financial Stability Report by IMF calls for a thorough restructuring of the financial system to prevent another crisis and pave the way for solid growth within the next 18 months.

FDIC’s Bair Says U.S. Should Move Carefully on Basel II Rules (BLM)
FDIC chairman Sheila Bair said the U.S. shouldn’t fully adopt new international banking standards if they allow some banks to hold less capital.

Economic News a Mixed Bag (WP)
Housing prices continued to climb but consumer confidence slipped, according to two reports released Tuesday, casting mixed signals about where the economy is headed.

Plenty More Bank Losses Expected Globally (WSJ)
The IMF calculates that the global financial crisis will produce $3.4 trillion in losses for financial institutions, between 2007 and 2010, a chunk of which already has been recognized.

Why Narrow Banking Alone is Not the Finance Solution (FT)
Demanding that banks act as narrow utilities solves the problem of the financial system taking control of the power to print money, but would need to be paired with a ban on other forms of banking, writes Martin Wolf.

Simon Johnson and Lawrence K. Fish on the Banking Crisis (Economix)
In a talk hosted by the M.I.T. Sloan School of Management, two finance experts discuss the risks for both under-regulation and over-regulation of banks going forward.

Are Financial Products like Technology? (FreeEx)
However one feels about financial innovation, it should be clear that it is fundamentally different from technological innovation.

Morgan Stanley’s Mack Proposes Single Global Bank Regulator (BLM)
Morgan Stanley CEO John Mack says a global regulator would ensure that U.S. banks aren’t subject to tighter regulations than the rest of the world.

FDIC Fund to Be in Red for Years (WSJ)
The fund that protects consumer bank deposits has fallen into the red and will remain there into 2012.

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