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WSJ Opinion: Potomac Watch

Are Bank Regulators Doing More Harm than Good?

WSJ Opinion: Potomac Watch

The Wall Street Journal

Society & Culture, News

4.22.8K Ratings

🗓️ 21 March 2023

⏱️ 22 minutes

🧾️ Download transcript

Summary

After UBS rescued Credit Suisse in a billion-dollar takeover bid, Janet Yellen warns investors that bailouts could be on the way for even smaller banks. But are these regulatory actions causing their own risks and harm? Plus, the world is on edge as Xi Jinping and Vladimir Putin meet this week, raising questions about that alliance and the war in Ukraine. Learn more about your ad choices. Visit megaphone.fm/adchoices

Transcript

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0:00.0

Buying a home in spring 2023 means both higher interest rates and stiff competition.

0:04.9

The Wall Street Journal's Your Money Briefing podcast is breaking it all down

0:08.0

in a special weekly series under contract. You're going to home buying new episodes

0:12.4

drop each Friday. Follow Your Money Briefing everywhere you listen to podcasts.

0:18.8

From the opinion pages of The Wall Street Journal, this is Potomac Watch.

0:23.8

Term oil continues in the banking sector, which is raising a new question.

0:28.9

Are regulators at this point doing more harm than good?

0:32.3

And Chinese leaders using pain arrives in Moscow in a show support for Russian

0:36.8

autographed Vladimir Putin. How worried some are the growing ties between the countries?

0:42.0

Welcome to Potomac Watch. I'm Kim Strassel and joined today by my brilliant colleagues,

0:47.1

Joe Sturberg and Kate Batchel, Darodell. So let's start with the banking sector we're going on like

0:52.6

day 10 of problems in that area. And things seem to be just as uncertain. At the moment,

0:58.1

there's very moment there are talks led by JP Morgan Chase CEO Jamie Diamond to potentially

1:03.3

rescue again, first Republic bank, over the weekends with officials engineered a forced

1:08.8

acquisition of Credit Suisse by UBS, though only after this was government had to provide some

1:13.6

9 billion to backstop some of the losses that UBS would take. And Treasury Secretary Janet Yellen

1:19.6

today said that the U.S. might move to cover deposits of yet more banks if there are more runs,

1:25.3

a statement that seemed designed to calm, but also suggests there could still be some big problems

1:30.3

out there. Joe amid all this, I guess I'd just make two points. One, more than a decade ago after our

1:36.7

last banking crisis, Congress swooped in with this complex new set of rules called Dodd-Frank and

1:41.5

told us that because of these rules, we'd never have a repeat. So I guess what we're seeing here

1:47.2

proves not so much. But the other point is that if Dodd-Frank ever had any merit, it was supposed

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