That is, among other criticisms. He has also recently advocated a ban on proprietary trading (trading done with the bank's own money, not the deposits it takes from customers) and limits on the acceptable size of banks. Not to say these policies are unwise--in fact, you might call them perfectly reasonable--one should note they represent a major flip-flop for Summers.
That's because as Treasury Secretary under the Clinton administration, Summers stood behind the Gramm-Leach-Bliley Act, which neutered the Glass-Steagal act of the Depression era and opened the floodgates for some of the greedy and risky mergers that put the banks (and the American people) in trouble over the last several years.
Nonetheless, we can hope that this change of heart is genuine and repentant (though probably not repentant), and that it does real, positive good for the stability of the financial system.
No comments:
Post a Comment