FDIC Considers Tougher Capital Requirements

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July 08 (Bloomberg) -- Anat Admati, Professor of Finance and Economics at Stanford Graduate School, discusses the FDIC considering tougher capital requirements for U.S. banks. She speaks on Bloomberg Television’s “Bloomberg Surveillance.” (Source: Bloomberg)

Economy, if they don't have 20%, 25% equity, no one will deal with them.

You assume or not they can raise the money, they can load the vote, but the money aside, why is that a bad thing?

They could do some productive things with it.

All we're saying is they would have more money in the form of equity instead of in the form of debt.

Most companies retain their earnings to invest and that is the first and most important source of funding.

Thanks like it may not like the price they get, but that does not mean it is not good for them and us that they have more of it.

Paul will go -- paul volker is almost as riled up as you are.

I had a chance to talk to him this weekend.

Here's what he had to say about the subject of bank rules.

However complicated you might argue the regulation is, and i don't think you should make it more complicated, there is no regulation.

Wire was sitting here three years later from dot-franken franken have no regulation?

They are fighting all the way.

Basically, your legal challenges.

Who is fighting?

The bank lobbyists are making it much more difficult.

Every rule gets 1000, 2000, 5000 comments.

Then the politicians pushed that you have to read them all.

So it becomes all very messy.

Which nation has the best capitalization right now?

Is there an example of a country the united states should follow?

Right now, switzerland is doing a better.

I heard recently that turkey is good on that issue.

All it takes is , in the uk, you had that, or i don't know now what will happen there, but you had that.

Then the politicians pushed back area and it takes more than just -- it does not make sense that countries go at this alone?

Shouldn't they streamline in order to reduce the competitive advantage and disadvantages of the banking regulations?

I think you heard the race to the bottom.

I am advocating a race to the talk.

We don't allow companies to do unsafe things just because someone else in the world allows that.

You jump on this perfectly, which there is no indication that everybody wants to get together.

I see no indication whatsoever that everybody wants to get on the same page.

Look at the watchdog on the federal reserve, talking tough about things and stricter requirements, which makes the bankers angry, of course.


When you look at the mood we're in right now, what would you hope to see through july, through august that makes for safer american banking system?

I want america to lead the world in bank safety.

There is no reason they shouldn't. our banks are in shape to raise equity at the markets and would make us nervous about other things they do.

There are things that are also urgent like to rivet its reform.

I am really anxious -- thank you so much.

Michael mckee's book of the summer.

This text has been automatically generated. It may not be 100% accurate.


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