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In a statement about Ms. Raskin, Jacob J. Lew, the Treasury secretary, said, "Sarah has a deep understanding of banking and financial regulatory issues as well as a firm grasp of how to run large, complex organizations".
And now many of the same people, who still don't have a fundamental understanding of banking, are designing a regulatory reform bill.
"As a Federal Reserve governor and former state banking regulator, Sarah has a deep understanding of banking and financial regulatory issues as well as a firm grasp of how to run large, complex organizations," Treasury Secretary Jacob J. Lew said.
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Progress on the key issue of a lack of competition amongst the banks, as well as insufficient transparency in lending decisions and the lack of understanding of banks' customers must now accelerate.
"Progress on the key issue of a lack of competition among the banks, as well as insufficient transparency in lending decisions and the lack of understanding of banks' customers, must now accelerate".
We actually had a pretty good understanding of bank runs; we just failed to notice that traditional banks were a much smaller share of the system than before, and that unregulated, unguaranteed shadow banks had become so important.
For example, we have a pretty good understanding of bank runs; extending that framework to shadow banking requires little more than the understanding that repo and other kinds of short-maturity obligations are, from an economic point of view, more or less equivalent to deposits.
We then develop a set of modern monetary economics whether New Keynesian Economics or New Classical Economics — where we imagine that we can think about the dynamics of the macroeconomy without a rich understanding of the banking system and without understanding that the banking system creates credit, money and purchasing power.
And social scientists saw the adoption of a paradigm as a route to respectability and research funding, which in due course led to the emergence of pathological paradigms in fields such as economics, which came to esteem mastery of mathematics over an understanding of how banking actually works, with the consequences that we now have to endure.
In fairness, if everyone were to agree that the agency is not going to be independent, the Federal Reserve may be the best place for it, given that it is one of the few places in Washington with an understanding of the banking system and markets.
"He is an outstanding business leader with a broad and deep understanding of the banking industry.
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Justyna Jupowicz-Kozak
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