Bove: Dodd-Frank the “worst piece of legislation in modern history”

Legislation effectively nationalized the banks

Richard Bove, an equity research analyst at Rafferty Capital Markets, doesn’t mince words, saying his initial judgement of Dodd-Frank as the worst piece of legislation in history was wrong: It’s actually worse than that.

When the Dodd-Frank Act was signed in the summer of 2010, I thought it would be impossible to find a worse piece of legislation in modern history. Looking back, I now believe that this judgment, dismal as it was, actually failed to capture how really bad this legislation was.

The government has effectively nationalized the banks. The regulations that have sprung from the Dodd-Frank Act demand the following:

  • Banks be penalized if they get too big.
  • Banks buy government-backed securities and Federal Reserve deposits (which are used for Treasury purchases) to meet liquidity requirements.
  • Banks make acceptable loans or be fined or penalized for making loans the government does not like.
  • Banks avoid borrowing in short-term money markets which are perceived to have systemic risk and raise funds in long-term equity markets, instead.

In so doing, the government has taken control of the bulk of money flows in the United States economy.

Read the full commentary here.

In an exclusive interview with HousingWire at the ABS Vegas conference in Las Vegas in February, Dodd-Frank co-author former Rep. Barney Frank, D-Mass., defended the legislation, saying it didn’t go far enough.

Latest Articles

Spouse of Quicken Loans executive sues AIME’s Anthony Casa for defamation

Theresa Niemiec, wife of Quicken Loans Executive Vice President Austin Niemiec, has filed a defamation lawsuit against Anthony Casa, CEO of the Association of Independent Mortgage Experts, for comments he made about her in a video message that he filmed and sent to her husband and others in the mortgage industry.

Jul 12, 2020 By
3d rendering of a row of luxury townhouses along a street

Log In

Forgot Password?

Don't have an account? Please