Frank looks to put the screws to the banks

“No more Fed to AIG, no more Fed to Bear Stearns”. That’s how Reuters quotes Barney Frank, who is holding a presser on his regulatory reform bill. It sounds as though they are taking away the Fed’s “13 (3) authority” (the ability to lend to anyone they see fit in an emergency).

While stopping short of reimposing Glass-Steagall separations of commercial and investment banking, regulators will be able to impose restrictions.

Bank stocks are not likely to like the sound of the huffing and puffing coming from Washington…It looks as though there will be lots of new regulation, but the question remains if the system will become any safer as a result. My guess is no…