Bernanke: Lack of ‘oversight’

Ben Bernanke dollar

Ben Bernanke dollar (Photo credit: Gage Skidmore)

Following is the extract from the Speech of Mr. Ben Bernanke:

He characterized subprime mortgages as a “trigger” of the crisis, but “vulnerabilities” — like a lack of oversight and regulations — were also largely to blame for amplifying the financial shocks, he said.As a result of the crisis, the Federal Reserve has since taken steps to strengthen its supervision of banks. Bernanke pointed to the Fed’s stress tests of the largest U.S. banks as an example of one improvement, but otherwise didn’t get into many specifics.”We want financial firms to be able to not only assess the current value of their portfolio, but we also want to understand where they would be under severe scenarios,” he said. (via Bernanke: Lack of oversight worsened crisis – Apr. 13, 2012.)

The words marked in italics forced me to check my English vocabulary and then grammar. Wiktionay defines oversight as “An omission; something that is left out, missed or forgotten. ” So the lack of oversight would mean that Fed should have overlooked something but it did not. Next word is Regulations. The complete phrase would be ‘lack of Regulations’. Now there can not be Regulations if you actually intend to overlook something. I have checked other websites. All carry the similar phrase.Here is the search result. Would somebody please stand up and tell me what he actually meant?

Welcome to the clearly ambiguous 21st Century!

© Sandeep Bhalla

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Bernanke: Lack of 'oversight'

Ben Bernanke dollar

Ben Bernanke dollar (Photo credit: Gage Skidmore)

Following is the extract from the Speech of Mr. Ben Bernanke:

He characterized subprime mortgages as a “trigger” of the crisis, but “vulnerabilities” — like a lack of oversight and regulations — were also largely to blame for amplifying the financial shocks, he said.As a result of the crisis, the Federal Reserve has since taken steps to strengthen its supervision of banks. Bernanke pointed to the Fed’s stress tests of the largest U.S. banks as an example of one improvement, but otherwise didn’t get into many specifics.”We want financial firms to be able to not only assess the current value of their portfolio, but we also want to understand where they would be under severe scenarios,” he said. (via Bernanke: Lack of oversight worsened crisis – Apr. 13, 2012.)

The words marked in italics forced me to check my English vocabulary and then grammar. Wiktionay defines oversight as “An omission; something that is left out, missed or forgotten. ” So the lack of oversight would mean that Fed should have overlooked something but it did not. Next word is Regulations. The complete phrase would be ‘lack of Regulations’. Now there can not be Regulations if you actually intend to overlook something. I have checked other websites. All carry the similar phrase.Here is the search result. Would somebody please stand up and tell me what he actually meant?

Welcome to the clearly ambiguous 21st Century!

© Sandeep Bhalla

Fed begging the beggers and USD falls

In my earlier post I had referred to scarce resources. Yesterday Mr. Ben Bernanke the chairman of Fed Reserve appealed to the institutions to help the community. But interestingly these institutions were helped by the Government with trillion dollars packages. Now this is the problem. As per Keynes theory stimulus had to be introduced at the level of people not institutions. Now institutions have survived but the people are suffering and money for people is scarce. Read and mark the words in italics:

Taking an entrepreneurial approach to community development results in innovative and effective programs, making communities more desirable places to live and more resilient in hard times. The CRA regulations encourage banks and thrift to invest in activities that provide affordable housing or financial services for individuals, promote economic development, or revitalize or stabilize low- or moderate-income areas.At a time when the needs of these communities are so great and the resources available to meet those needs are so scarce, it behooves financial institutions to think broadly about their CRA obligations. By partnering with other community stakeholders, these institutions can help address existing community needs and lay the groundwork for stronger credit demand in the future.I don’t want to underestimate the difficulty of the task. The recession damaged communities of all types, but particularly lower-income neighborhoods, and economic recovery has been stubbornly slow. Nonetheless, the commitment and innovation demonstrated in communities all across the country is encouraging. Taking an entrepreneurial approach to community development and thinking about the needs of both people and places will, I believe, make for stronger, more resilient communities in the future.

via FRB: Speech–Duke, Building Sustainable Communities–March 27, 2012.

Jahangir - Abu al-Hasan

In India King Jahangir was the first emperor to provide stimulus to masses by engaging labour during the day to construct and different labour at night to demolish what was not upto the mark.(It is however not mentioned in his wiki page)  He was able to generate employment and beautiful buildings. Here stimulus goes in the hands of corrupt and greedy institutions who had committed fraud in the first place by creating artificially secured instruments a.k.a. Toxic Assets.

© Sandeep Bhalla.

Ben Bernanke, chairman of the Board of Governo...