Friday, June 21, 2019

Blinder: Does NCUA and the Federal Reserve Have Same Insight into Systemic Financial Risk?

In an op-ed in the Wall Street Journal, Alan Blinder, a professor of economics and public affairs at Princeton University and a former vice chairman of the Federal Reserve, discusses flaws in the structure of the Financial Stability Oversight Council (FSOC).

The Dodd-Frank Act created FSOC. FSOC is a 10-member panel consisting mainly of the heads of the nation’s top financial regulatory agencies.

However, Blinder questions the design of FSOC.

For example, Blinder wrote:
"[Y]ou might question the FSOC’s voting structure: every agency gets one vote. So it gives equal weight to the chairmen of the Fed and the National Credit Union Administration. Do you think they have equal insight into systemic financial risk?"

Read the op-ed (subscription required).
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1 comment:

  1. AnonymousJune 21, 2019 at 2:28 PM

    After reading your work for almost 10 years, I would be led to believe the question is yes. Especially since you and the owner of this website contend that NCUA leadership is going to run credit unions into the need of a taxpayer-funded bailout. Of course, this is familiar to bankers needing such a bailout twice.

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