Regulators Should Move Faster to Make Shadow Banks Safer
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April 4 (Bloomberg) -- The U.S. is busy exiting itstaxpayer-funded bailouts, most recently reducing its stake inAmerican International Group Inc. And AIG is consideringincreasing its mortgage book by purchasing the loans it insures,a move that could be profitable for AIG, but could also heightenthe insurer’s risks -- and taxpayers’ too.
Nearly four years after the financial crisis began,regulators on Tuesday finally agreed to the criteria they willuse to decide which parts of the shadow banking system toregulate, but they still haven’t imposed tougher standards on asingle insurer, hedge fund, private-equity shop or money-marketmutual fund. Failure to do so exposes the U.S. economy tounnecessary dangers.