This will add another regulative legislation on top of a pile of existing regulation in the banking sector — no amount of government control can prevent bank failures. Recently, there was a thread of “dystopian surveillance” of employees in the banking sector which is the natural outcome if you constantly ask the government for help.
The current problems of the banking sector are a result of the bad incentives created by monetary policies. Banks will never work perfectly well for everybody but all these financial crises during the last couple of decades root could have been avoided by less government spending (for wars) and a much tighter monetary regime.
Left-leaning people should start informing themselves about monetary theory and general economics to avoid a vicious cycle of ever more government meddling dealing with the results of previous meddling that will ultimately undermine and destroy our free society.
> no amount of government control can prevent bank failures
This is an absurd statement that makes you sound like a child. The USA went 50 years without a bank failure after Roosevelt's reforms during the Great Depression. After those reforms were loosened in the 1980's and 90's, they became routine.
Canada and Australia regulate their banks more heavily than the US. They were also the only developed countries not to have a wave of bank failures during the financial crisis of 2008. They're still free societies.
Preventing bank failures is both possible and straightforward to do. All it takes is the will and sense to stand up to the super-rich.
> After those reforms were loosened in the 1980's and 90's, they became routine.
Correlation is not causation. 1973 marks the end of Bretton-Woods i.e. abolishing the Gold standard and, hence, an unprecedented expansion of the monetary base. The 1970s are remembered for their high inflation rates similar to today. Inflation also helped the Federal Government to finance its Vietnam war. Since 9/11 the FED is printing money like crazy which helped the government to finance its wars in Afghanistan and Iraq. With the Covid crisis monetary expanded like never before. Now we have a banking crisis, high inflation rates and a looming recession. But you tell me it’s because of the bank bosses‘ boni.
That’s exactly what I meant with „go inform yourself“ — it’s not meant to sound rude but it’s about understanding what’s really going on.
It’s the warfare state needing cheap money and credit. It’s not you and me. Especially not the American worker. That’s why I was directing my comment to left-leaning citizens: Learning about monetary and general economic theory will sharpen your arguments and help you to win your fight for a more egalitarian and free American society.
May I suggest this little classic on money and banking:
It's insane how much pain Americans are willing to endure just so the Wealthy can have access to a playground and possibly an extra 0.5% of GDP go straight into their pockets.
Per https://www.fsb.org/wp-content/uploads/P211122.pdf the only Tier 4 bank is US based but _plenty_ of other banks around the world are systemically important. Is the US overly represented? Sure. But I’d also imagine they are more interconnected to the global financial system than other world wide banks
> Right now, at the behest of wall street banks, the Federal reserve is preventing narrow bank charters
The proper route for this is legislation, not rule making. Narrow banks aren't asking to just custody deposits. They're asking for a reserve account at the Fed.
(Also, Wall Street banks have nothing to do with this. The fear is deposits fleeing e.g. regional banks, not SIFIs.)
Please speak down to me about politics and education! Obviously everyone can see you've been awarded several McArthur grants and a couple of Nobel prizes.
The current problems of the banking sector are a result of the bad incentives created by monetary policies. Banks will never work perfectly well for everybody but all these financial crises during the last couple of decades root could have been avoided by less government spending (for wars) and a much tighter monetary regime.
Left-leaning people should start informing themselves about monetary theory and general economics to avoid a vicious cycle of ever more government meddling dealing with the results of previous meddling that will ultimately undermine and destroy our free society.