Archive for September, 2010
New rules on how much rainy-day capital banks must keep in reserve are more rigorous than they first seem and create “a road to a much safer banking system,” the chairman of the panel that is writing the regulations said Wednesday, implicitly answering criticism that the proposals are too lax.
The new rules are “extremely demanding” and “radically transform the regulatory capital framework,” Nout Wellink, chairman of the Basel Committee on Banking Supervision and president of the Bank of the Netherlands, said at a meeting in Singapore of officials who regulate the financial industry.
“If, prior to the crisis, banks had the levels of capital we are asking for, we likely would not have experienced such a deep crisis,” Mr. Wellink said, according to the text of his speech.
The sweeping U.S. financial regulation that introduced the Volcker Rule to banks missed three important areas, the provision's namesake said Wednesday.
Paul Volcker, chairman of President Barack Obama's Economic Recovery Advisory Board and former Federal Reserve chairman, said the U.S. mortgage market, money market funds and ratings agencies are issues that still need to be addressed in the wake of the global economic crisis.
He also said that quasi-government institutions are "abnormal" and don't work. Volcker was speaking at an International Economic Alliance event in New York.
Earlier this month, Senate Bill No. 1481 and its counterpart, House Bill No. 6423, were introduced to the Michigan Legislature seeking to amend the foreclosure by advertisement statute by requiring mortgage servicers to participate in Michigan's "Help for the Hardest Hit" program.
If the bills are passed and signed into law by the governor, servicers who have not signed on to participate in the hardest hit program will be unable to foreclose certain mortgages by advertisement and instead, would be required to foreclose judicially. The bills have currently been assigned to the respective committee of each branch of Michigan's Legislature for review. As always, we will keep you updated on any changes or movements of these particular bills.
Rising foreclosure inventories across the country translate into great deals for consumers, as banks continue to offer discounts on these properties to quickly move them off their books. Hudson & Marshall, America's leading real estate auction firm, will auction over 200 bank-owned homes in Chicago October 2nd and 3rd at 1:00 p.m. at the Westin Lombard Yorktown Center.
Buyers will be required to make a cash or certified check deposit of $2,500 for each property, which they are the winning bidder. For properties selling for $10,000 or less, a buyer must pay the full purchase price of the homes on sale day. All sales will close within 30-45 days and buyers may secure financing with the lender of their choice prior to closing; however, closing is not contingent upon financing.
Next week, the Federal Deposit Insurance Corporation will propose final conditions securitized assets will have to meet to benefit from safe harbor protection when the issuer goes into conservatorship or receivership.
The agency had issued and extended an interim safe harbor rule through September 30. This followed accounting changes introduced in the summer of 2009 that disqualified most securitizations by bringing them onto banks' balance sheets.
The FDIC's move this time around, however, is not an extension because the agency intends to reveal its final rule on how it will treat the securitizations of an entity under its receivership or conservatorship.
The actual figure of the US' national debt is much higher than the official sum of $13.4 trillion given by the Congressional Budget Office, according to analysts cited on Sunday by the New York Post.
"The Government is lying about the amount of debt. It is engaging in Enron accounting," said Laurence Kotlikoff, an economist at Boston University and co-author of The Coming Generational Storm: What You Need to Know about America's Economic Future.
"The problem is we're seeing an explosion in spending," added Andrew Moylan, director of government affairs for the National Taxpayers Union.
In 1980, the debt – the accumulated red ink incurred by the Federal Government – was $909 billion.
