safe banking

a blog on banking, corporate governance, and financial market reform.

March 9, 2018

Mitch McConnel’s Big Gift to the Banks

This month marks the tenth anniversary of the $29 billion US government-backed bailout of Bear Stearns. The collapse of this giant investment bank in March 2008, under the weight of its bad mortgage-linked bets, marked the beginning of the global financial crisis.

To commemorate it, the US Senate plans to deliver a big gift to the banking sector by removing several safeguards for American families put in place after the meltdown.

Tin is the traditional tenth wedding anniversary gift. A bank deregulatory bill on the crisis anniversary is a fitting present from someone with a tin ear.

Senate Majority Leader Mitch McConnell has announced that this week the Senate, rather than respond to the plague of gun violence by considering gun law reforms after the Parkland shooting, will begin debating the rollback of financial reforms

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In the wake of the financial meltdown in 2008, there were many who claimed it had been inevitable, that “no one saw it coming,” and that subprime borrowers were to blame.