| Teesus | Date: Friday, 2013/07/12, 10:49 AM | Message # 1 | DMCA |
|
|
Private
Group: Checked
Messages: 817
|
inShare
 Protesters rally in 2011 against the role of Wall Street banks in the 2008 financial crisis. David McNew/Getty Images
In the years since the financial crisis, the role banks play in the financial system has come under a lot of scrutiny.Banking is an industry with a huge contradiction at its core: Depositors want to use banks as a safe place to put their money.
But banks are expected to lend that money out, providing capital to
businesses and households to make investments, a practice with inherent
risks. The less a bank lends, the less it risks its depositors' funds,
yet at the same time, the less productive its investments can be.As banking analyst Frances Coppola notes in Pieria:t is plain that people expect banks both to provide security for savings and payments AND
provide risk capital for businesses. The apparent impossibility of
achieving both of these appears to be lost on politicians who call for
banks to make their balance sheets safer (so as not to put deposits, and
by extension taxpayers' money, at risk) then criticize them for
reducing risk lending. This is fundamentally inconsistent. [Pieria]Read Full Story
|
|
|
| |
Main 
