Tag Archives: Federal Reserve

News Release: Fed Must Set Priorities, Impose Conditions, Ensure Transparency for Coronavirus Funding

Absent major changes, the Federal Reserve’s multi-trillion-dollar funding programs will reward corporate insiders and financial speculators, without guaranteeing desperately needed help for those hardest-hit by the coronavirus crisis. The Fed needs to set the right priorities for this credit and impose conditions that ensure the benefits of this extraordinary assistance go to those who need it most.

Comment Letter: Comments on Federal Reserve Emergency Facilities

Together, these facilities could deploy up to $2.3 trillion in new credit to the economy during the pandemic crisis period. Without major changes these facilities will not be effective in getting assistance to those most impacted by the crisis, and disclosure and transparency regarding specific borrowers and loan terms is lacking. Our comment provides specific recommendations to address these issues.

In The News: Who’s getting these hundreds of billions in government aid? For now, the public may be in the dark. (The Washington Post)

Critics also noted that while the central bank has to share some basic information about the loans, other details, such as how many employees the company has retained or the compensation for its chief executive, might never be shared publicly. “We should ask for the actual deal documents. Why wouldn’t you make those public?” said Marcus Stanley, policy director at Americans for Financial Reform.

In The News: States Need Help From the Fed This Time (Bloomberg Opinion)

State and local governments are the main providers of basic public services in the U.S. They are on the front lines of combating the Covid-19 pandemic, the most serious public-health threat in a century. But it’s unlikely these governments will have the funds they need to fight the epidemic properly unless Congress acts to require the Federal Reserve to expand state and local fiscal powers.

News Release: Federal Reserve Rendering Volcker Rule on Speculative Trading “Close to Useless”

In August regulators issued a rule that dramatically weakened the Volcker Rule limits on direct proprietary trading by banks. Today, they have proposed new changes that would greatly weaken restrictions on banks taking risks through ownership of external funds, including venture capital funds and securitization vehicles like collateralized debt obligations.

In The News: Wall Street Venture-Fund Curbs to Be Eased in Volcker Revamp (Bloomberg)

In revising the Volcker Rule’s proprietary trading ban last year, the regulators had already relaxed one component of the limits on investment in funds, clarifying the industry’s ability to do so on behalf of clients. Backing off some of the fund restrictions will “complete the process of neutering the rule,” Marcus Stanley, policy director at Americans for Financial Reform, said in a criticism of the regulators’ actions last year.