Monday 25 July 2016

Wonkbook: Why Clinton's pick for vice president might contradict her message on Wall Street

By Max Ehrenfreund Hillary Clinton has picked Tim Kaine as her running mate, despite criticism from liberal Democrats for his lenient positions on Wall Street. A letter the senator from Virginia sent to the Federal Reserve earlier this week shows why they're frustrated. In the letter, Kaine and three other senators ask Janet Yellen, the head of the central bank, …
 
Wonkbook
The latest economic and domestic policy from Wonkblog
 
 
Hillary Clinton, embraces Sen. Tim Kaine (D-Va.) in Annandale, Va. on July 14. (Photo by Melina Mara/The Washington Post)

Hillary Clinton embraces Sen. Tim Kaine (D-Va.) in Annandale, Va. on July 14. (Photo by Melina Mara/The Washington Post)

By Max Ehrenfreund

Hillary Clinton has picked Tim Kaine as her running mate, despite criticism from liberal Democrats for his lenient positions on Wall Street. A letter the senator from Virginia sent to the Federal Reserve earlier this week shows why they're frustrated.

In the letter, Kaine and three other senators ask Janet Yellen, the head of the central bank, and her colleagues to exempt some banks from a requirement that they report important data on their financial stability every day.

"The daily reporting requirements may impose significant burdens on the firms without associated benefits to the financial system," writes Kaine along with Sens. Mark Warner (D-Va.), Gary Peters (D-Mich.) and Robert Casey Jr. (D-Pa.).

This rule forces financial institutions to calculate their liquidity — a measure of how easily banks can pay any debts they owe in the short term. Calculating liquidity can be a complicated process for a large financial institution, and without having to meet daily requirements, banks would be able to make riskier, more profitable investments.

In a financial panic, it can be difficult for banks to secure new loans, so they must be able to cover their existing debts without borrowing money from another bank. If depositors doubt a firm's ability to do so, there could be a run on the bank.

Read the rest on Wonkblog.


 

Chart of the day

Gamblers who bet on Donald Trump early won big. Kim Soffen has more.

timeline


Top policy tweets

"When FOMC meets this week, most investors expect them to do what they have done at every meeting this year: nothing https://t.co/FRVJnN83cE" -- @toristilwell

"Hysteresis ain't just about the labor market. How recessions might reduce productivity growth https://t.co/zkJ1KMjb6R" -- @nick_bunker

"Africa is being looted with the complicity of banks, businessmen and real estate brokers from rich countries https://t.co/ZVkzQmu6dd" -- @alexcuadros

ADVERTISEMENT
 
Most Recent Posts from Wonkblog
The downside of being happy
Nobody likes to be sad, but it can have a powerful and positive effect.
 
People who took a gamble on Trump's nomination walked away rich.
It would have just taken a little bit of foresight.
 
Why Clinton’s pick for vice president might contradict her message on Wall Street
Some liberals are feeling betrayed by the person Clinton picked as a running mate.
 
ADVERTISEMENT
 
Recommended for you
 
Federal Insider
Federal news and policy update, in your inbox daily.
Sign Up »
 
     
 
©2016 The Washington Post, 1301 K St NW, Washington DC 20071
 
 
 

No comments:

Post a Comment