, Columnist
How the Fed Got Drawn Into the Shadows
Proposed new rules recognize the pivotal economic role of hedge funds, private equity and private credit
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Bankers are warning that tougher capital rules being proposed by the Federal Reserve and other US regulators will push more risks out of well-regulated lenders and into markets. “This is great news for hedge funds, private equity, private credit … they’re dancing in the streets,” Jamie Dimon said on JPMorgan Chase & Co.’s earnings call last month even before the entire proposal was unveiled.
The chief executive officer of the biggest US bank has since called the plans “hugely disappointing,” saying they will likely increase costs and restrict supplies of some mortgages and small business lending — from banks at least.