Did anyone else hear or see it!!??

"expecting systemic problems in the bigger banks""

Did anyone catch that?? Whats he talking about??

-- D.B. (dciinc@aol.com), October 11, 1999

Answers

Here's a link to the transcript of his speech, from the Fed web site. I have not had a chance to read it yet...

Ed

-- Ed Yourdon (ed@yourdon.com), October 11, 1999.

Whoops! I clobbered the URL in my previous post. Hopefull, THIS is the correct link to Greenspan's Phoenix speech

-- Ed Yourdon (ed@yourdon.com), October 11, 1999.

I can assure you we'll hunt high and low for it if you'll give us some more details???

-- lisa (lisa@work.now), October 11, 1999.

http://www.bog.frb.fed.us/boarddocs/speeches/1999/19991011.htm

-- Bill P (porterwn@one.net), October 11, 1999.

And here's a link to an article about it. Hell, here's the article: no explicit mention of Y2K. [Fair game: educational/reference purposes]

Fed Regulators Eye Bank Mergers
By MARCY GORDON 
AP Business Writer

WASHINGTON (AP) -- Fed Chairman Alan Greenspan said today that regulators are weighing changes to deal with the huge banks being formed by mergers that could hurt the economy if they fail.

In a speech to bankers, the Federal Reserve chief said ``significant changes are in the pipeline'' in banking supervision by U.S. regulators and their foreign counterparts.

The changes point to a ``multitrack approach'' to oversight of banks, since they vary significantly in size, business strategy and penchant for risk, Greenspan said.

``Even among the largest banks, no two institutions have exactly the same risk profiles, risk controls or organizational and management structure,'' Greenspan said in the speech to the American Bankers Association's annual convention in Phoenix. Copies of his speech to the banking industry's biggest trade group were released in Washington.

Because banks vary so widely, he said, government oversight needs to be ``customized for each (financial) institution: the more complex an institution's business activities, the more sophisticated must be our approach to prudential oversight.''

Greenspan said such flexibility is especially evident in the case of ``megabanks'' which, he said, ``create the potential for unusually large systemic risks in the national and international economy should they fail.''

Regulators such as the Fed must walk a line between exercising adequate oversight of such big banks and regulating them excessively in a way that smothers innovation and competition, he suggested.

``Such a heavier hand would also blunt the ability of U.S. banks to respond to crisis events,'' Greenspan said. ``Increased government regulation is inconsistent with a banking system that can respond to the kinds of changes that have characterized recent years.''

Big bank mergers have been occurring at an accelerated pace in this country, with recent multibillion-dollar consolidations including those in which banking giant Citicorp merged with brokerage-insurer Travelers Group; NationsBank Corp. and BankAmerica Corp. combined; and Banc One Corp. and First Chicago joined.

Critics, including consumer advocates such as Ralph Nader and some lawmakers, have asserted that the mergers have increased the likelihood of future taxpayer bailouts of big financial institutions that fail.

Beyond responding to the rise of huge banks, Greenspan said, ``few changes'' are needed to the current system of regulation for the vast majority of banks in the United States.

-- lisa (lisa@work.now), October 11, 1999.

He is really talking about the exposure these megabanks have in the derivative markets, particularly metals. Shorting Gold and silver.

"He's got the whole world in his hands"

-- Backspace (delete@no .way~), October 11, 1999.

'the tares will be gathered into bundles..to be burned'.

The bigger they are, the harder they fall.

Ooopsie!

-- ..- (dit@dot.dash), October 11, 1999.