U.S. Regulators Warns Against Interest Rates

The U.S. Regulators have sent a warning to American financial institutions, and warns against the risk of rising interest rates.  But on Wall Street no one seems to care.

“We have now a financial system that is completely based on moral hazard

Simon Johnsen

(Article in Norwegian, links to sources in English)

Amerikanske tilsynsmyndigheter har sent ut en advarsel til bankene om å være forberedt på en renteøkning.

De amerikanske tilsynsmyndighetene, bestående av Board of Governors of the Federal Reserve System, FDIC, National Credit Union Administration, The Office of the Comptroller of the Currency, The Office of Thrift Supervision, The Federal Financial Institutions Examination Council og State Liaison Committee, har sendt et rundskriv til amerikanske finansforetak der de oppfordrer selskapene til å være forberedt på at renten kan økes.

“The financial regulators are issuing this advisory to remind institutions of supervisory expectations regarding sound practices for managing interest rate risk (IRR). In the current environment of historically low short-term interest rates, it is important for
institutions to have robust processes for measuring and, where necessary, mitigating their exposure to potential increases in interest rates.”

Ingen reaksjon

De amerikaske myndighetene viser til at de nåværende økonomiske forholdene krever en sterk risikostyring av bedrifter i alle størrelser.

“Current financial market and economic conditions present significant risk management challenges to institutions of all sizes. For a number of institutions, increased loan losses and sharp declines in the values of some securities portfolios are placing downward pressure on capital and earnings. In this challenging environment, funding longer-term assets with shorter-term liabilities can generate earnings, but also poses risks to an institution’s capital and earnings”

Here’s a copy of the letter from the regulators to the U.S. financial institutions.

– Basert på moralsk hasard

Men på Wall Street er det knapt noen som løfter et øyelokk.

Det kan nok tolkes på flere måter – her er en måte, representert ved professor Simon Johnsen ved MIT:

“We Now Have A Financial System That Is Completely Based On Moral Hazard”


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