Posts Tagged ‘banks’

Law enforcement for profit roundup

Banking and finance roundup

  • Bernie Sanders still rants and raves about Glass-Steagall Act. Who will break the news to him? [Catherine Rampell/WaPo, P.M. Carpenter (Krugman, Pearlstein in accord with Rampell), earlier] “Hillary Clinton vows to go ‘well beyond’ Dodd-Frank” [Housing Wire via Kevin Funnell]
  • “In the past, ‘financial institutions were unwilling, for relationship reasons, to litigate against each other…That has changed dramatically.'” [Daniel Fisher quoting New York attorney Brian Fraser]
  • “Government Thinks You’re Too Dumb To Try Crowdfunding” [Ben Weingarten, The Federalist]
  • “If every bank behaved like Abacus, the financial crisis wouldn’t have occurred.” So guess which bank got prosecuted [Jiayang Fan, The New Yorker back in October]
  • Billions in free money for consumers, just by regulating credit card fees! Sorry, it’s not that simple [Todd Zywicki]
  • “The war against cash”: government vs. the cash economy [Daniel Mitchell, Cato, first and second post]
  • New IRS authority to secure revocation of passports should give pause to everyone concerned about American liberty [Investors Business Daily]

Banking and finance roundup

  • Trying to buy gift cards in bulk as an employee bonus, Coyote discovers anew that the government hates cash;
  • Initial public offerings are drooping again, regulation one reason [Thaya Knight, Cato]
  • A dissent from the lamentations, here and elsewhere, on the decline of small community banks [Ira Stoll] “Fed’s Tarullo says looking into smaller banks’ concerns” [Business Insider]
  • Berned out? Financial transactions tax “one of the more overrated ideas in American Progressive political discourse” [Tyler Cowen, Wikipedia on Sweden’s experience via @aClassicLiberal on Twitter] And Sen. Sanders continues to express incredulity on Twitter about college loans’ carrying higher interest than home mortgages do, despite attempts to enlighten him on the whole topic of secured lending and collateral [@tedfrank]
  • Video of Federalist Society convention panel on constitutionality of administrative law judges at SEC and elsewhere with John S. Baker, Jr., Stephen Crimmins, Todd Pettys, Tuan Samahon, moderated by F. Scott Kieff;
  • Consumer Financial Protection Bureau ban on contractual arbitration will help class action lawyers, few others [Todd Zywicki, Mercatus]
  • “How US policies to stop terrorist financing end up hurting innocent families abroad” [Dylan Matthews, Vox] Money laundering regs, “de-risking” result in many bank closures in U.S.-Mexico border areas, hassles result for local residents and businesses [Kevin Funnell]

Community banker: it’s better in the U.K. at this point

“When I went to Britain I thought the regulatory environment would be much worse,” he says. “It’s infinitely better there,” says Vernon Hill, who headed for the U.K. after a career in the community bank sector in the United States. The founding of new banks has fallen virtually to zero in the U.S. since the enactment of Dodd-Frank [Stephen Moore, W$J via Kevin Funnell]

Banking and finance roundup

We’re from the government and we’re here to help, part 726,914

The Consumer Financial Protection Bureau (CFPB)’s campaign against disparate impact in car loans is raising costs for some borrowers. Thanks, Sen. Warren! “The results highlight the sometimes unpredictable consequences of attempts to regulate lending practices…. Efforts by the CFPB to police the fairness of auto loans have accelerated in recent years under Director Richard Cordray.” [Morningstar/Dow Jones, W$J]

“Abolish cash? You’d be losing a crucial part of free society”

Matthew Lynn at the Telegraph notes

a growing movement among academics and now governments to gradually ban the use of cash completely. It is inefficient, oils the underground economy, and makes it harder for central banks to manage the economy, or so runs the argument.

But while a “cashless economy would be far easier to both tax and control” for the authorities, it would afford to the governed both less convenience and less freedom:

A simpler and more efficient “payment technology” has never been invented. No matter how smart our mobiles get, or how much data can be loaded on to a debit card, a banknote is an incredibly efficient way to handle small transactions. It is costless, immediate, flexible, no one ever needs a password, it can’t be hacked, and the system doesn’t ever crash.

More importantly, cash is about freedom. There are surely limits to the control over society we wish to hand over to governments and central banks? You don’t need to be a fully paid-up libertarian to question whether, in a world where we already worry about the amount of data that Facebook and Google can gather about us, we really want the banks and the state to know every single detail of what we are spending our money on and where. It is easy to surrender that freedom – but it will be a lot harder to get back.

Banking and finance roundup

  • Marcia Narine on D.C. Circuit’s recent ruling striking down part of Dodd-Frank conflict mineral disclosure rule [Business Law Prof]
  • More on suit challenging constitutionality of FATCA, the law complicating many expatriates’ lives [Paul Mirengoff, PowerLine]
  • “Jury Will Put A Price On Terrorism — And Stick A Bank With The Bill” [Daniel Fisher, Reuters on Arab Bank settlement]
  • Operation Choke Point: “How a program meant to stamp out fraud has put a stranglehold on legitimate industries” [Reason TV video, AmmoLand on markup of Rep. Blaine Luetkemeyer’s anti-Choke-Point Financial Institution Customer Protection Act]
  • Federal Reserve’s denial of core banking services to Colorado cannabis businesses: consistent with its authorizing statutes? [George Selgin/Cato, related from me on RICO suit against bankers, bonders, and others interacting with the industry]
  • “A financial system based not on … charging interest for lending … but on traditional social values”: Russia’s Orthodox Church backs interest-avoiding finance system akin to Islamic sharia finance [Bloomberg, Moscow Times]
  • Two popular views in tension with each other: “Wall Street = short term thinking” and “Wall Street spins meager current earnings into bubbles” [Kevin Erdmann via Tyler Cowen]

One small banker’s warning

Small banks and other regulated businesses now live at the permission of arbitrary regulators in a legal system that no longer protects individual rights. That’s the message of a letter sent to shareholders earlier this year by Frank H. Hamlin III, CEO of the small Canandaigua National Bank in upstate New York. In particular, Hamlin cites the way the office of New York attorney general Eric Schneiderman has pushed around two other upstate banks (not his) on ill-defined redlining charges based on doing too much of their lending in the suburbs. I write about it in a new post at Cato at Liberty.

The piece is a sidebar from a much longer piece I wrote on Schneiderman’s record in the Summer issue of City Journal, newly online. I’ll have more to say next week about other parts of that article.