A couple of interesting articles on banks that I've run across lately. The first has to do with toughening regulations on the banks, forcing them to keep more capital. I'm certainly all for that, but I wonder if the changes listed really accomplish anything. The problem I see is that mark-to-market accounting was suspended after the banking crisis for some classes of assets. And as long as those assets can be valued at whatever the companies want, the requirements seem pretty meaningless.
The only reason I give any credit at all to that article was that it was cited encouragingly by Paul Krugman, whom I admire, and who certainly knows more than I do. I wonder if he's missing that (potential?) loophole, or if it really isn't there.
The other interesting one has to do with how banks are now (or, at least, seem to be) manipulating the commodities markets via some seemingly completely unrelated to banking maneuverings.
I don't really know anything, beyond what he's reported, but it's pretty scary. Everyone should be watching what's happening, because that has the potential to be a tax on the entire rest of the economy. But hey, that's economic efficiency, right? Isn't that why we don't need any more regulations?
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