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This is why the Treasury, OFHEO and others are urging Congress to pass a bill that gives the currently feeble regulator similar powers to those of bank supervisors.The GSEs seem unworried by the prospect of more stringent regulation.
"But OTS was a feeble regulator.
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Local practices matter, never more so than when things go wrong.Consider, for example, the well-known fact that Italy has a feeble stockmarket regulator.
Congressional investigators are exploring whether regulators and feeble risk controls allowed MF Global to topple.
Is current regulation so feeble?
"The debate about the successor to the Press Complaints Commission has been dominated by two fears: over-regulation, whereby a new regulator can tell editors what they may or may not publish, and feeble 'self-regulation', which is a euphemism for institutional inertia.
At first, the commission reacted timidly to their recalcitrance, setting up a feeble Forum of European Securities Commissions (FESCO) in 1997 to promote co-operation among securities regulators.
But this is a feeble form of accountability which will have to vie with the scrutiny of the independent regulator.
Instead they have limped on, too feeble to make new loans to growing businesses and too cosseted by politicians and regulators to take choices that might hurt their shareholders but benefit their economies.This week the European Banking Authority, which co-ordinates national regulators, took a big step towards forcing banks to clean up their balance-sheets.
The culprits ranged from a widespread faith in the academic efficient-market hypothesis to the feeble standards at credit rating agencies, which allowed bundles of subprime mortgages to be treated as "investment grade," to regulators and policy makers who did not understand the severity of the situation until it was too late.
Feeble labeling.
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Justyna Jupowicz-Kozak
CEO of Professional Science Editing for Scientists @ prosciediting.com