Former Fed chair Volcker: financial crisis not over
|
|
|
NEW YORK (Reuters) - Paul Volcker, a former head of the U.S. Federal Reserve, said the financial crisis was not finished yet despite drastic actions from the central bank that are broadening its role in managing the economy.In an interview with Charlie Rose on PBS television late Tuesday, Volcker said the country's troubles are the inevitable consequence of a bubble in housing that was clearly unsustainable."I don't think this crisis is over," he said. "It's quite a serious matter. We have seen the Federal Reserve take more extreme measures in some respects than any that have been taken in the past to deal with a financial crisis, which raises some real questions."The Fed has pumped over half a trillion dollars into the financial system, boosted its emergency lending facilities, and pledged to take on some of the mortgage debt ravaging banks' balance sheets and causing billions in losses.These events led to an investor-led run on the bank over the weekend that left Bear Stearns all but stripped of liquid assets.The Fed, sensing a broader risk, stepped in to broker a buyout of the bank by larger rival J.P. Morgan, a move that Volcker said calls for greater regulatory oversight of investment firms like Bear."That is a new precedent," Volcker said. "Whether it's wise or not depended on how severe this crisis was and their judgment about the threat of the demise of Bear Stearns. That's a judgment they had to make, and an understandable judgment.""If we are going to lend to them, one of the questions that arises over what happened, if we are going to lend to them and protect them, shouldn't they be regulated? I think the answer... (is) yes."(Writing by Pedro Nicolaci da Costa, Editing by Chizu Nomiyama) (c) Reuters 2008. All rights reserved. Republication or redistribution of Reuters content, including by caching, framing or similar means, is expressly prohibited without the prior written consent of Reuters. Reuters and the Reuters sphere logo are registered trademarks and trademarks of the Reuters group of companies around the world.
|
|
|
|
|
|
Related News
Five more US bank failures bring total for 2009 to 120
New York - Bank failures in the United States have risen to 120 this year as five more regional institutions were added to the list, the US agency that guarantees the safety of bank deposits said. United Commercial Bank in San Francisco with assets o...
US stocks climb slightly despite double-digit jobless rate
New York - US stocks posted mild gains Friday to end the week as investors shrugged off government figures that put the unemployment rate above 10 per cent. The Labour Department said the jobless rate hit 10.2 per cent in the month of October, the hi...
US joblessness hits 10.2 per cent, highest in 26 years - Summary
Washington - The US unemployment rate surged to 10.2 per cent in October, the highest in 26 years as another 190,000 people lost their jobs, the Labour Department reported Friday. The figure comes after a 9.8-per-cent jobless rate in September and wa...
US joblessness jumps to 10.2 per cent, highest since 1983 - Update
Washington - The US unemployment rate surged to 10.2 per cent in October, the highest in 26 years, as another 190,000 people lost their jobs during the month, the US reported Friday. The figure reported by US Labour Department came after the 9.8 per ...
US jobless rate jumps to 10.2 per cent
Washington - The US unemployment rate surged to 10.2 per cent in October as another 190,000 people lost their jobs, according to US Labour Department figures released Friday. The jobless rate stood at 9.8 per cent in September. Unemployment had been ...
Bulls stop James, edge Cavs - Summary
Los Angeles - The King couldn't deliver in the clutch. Luol Deng and Joakim Noah combined to deny LeBron James a potential game-winning drive in the final seconds as and the visiting Chicago Bulls snapped the Cleveland Cavaliers' three-game winning...
Mortgage lender Fannie Mae posts nearly 19-billion-dollar loss
Washington - US mortgage lender Fannie Mae said Thursday that it would seek 15 billion dollars in federal aid, after posting its ninth consecutive quarterly loss. Fannie Mae reported a net loss of 18.9 billion dollars in the third quarter of 2009, co...
|
|
|
|
|
|
|
|
