Thursday, October 21, 2010

What the Banks Touched they Destroyed

Simon Johnson has a great post outlying our current foreclosure crisis and offers a reasonable way to address it:

The only fair, reasonable, and safe way to handle this situation is to order a fresh round of stress tests for all systemically important financial institutions. The stress scenario should consider not just the current dismal macroeconomic prognosis (and the potential for another slip back into recession) but also the downside with regard to litigation losses.

If the Financial Stability Oversight Council refuses to act decisively in this regard, a vital piece of the Dodd-Frank financial reforms will have failed.

Elizabeth Warren might be the most important appointment of Obama's entire presidency when this mess is done.

I am Frank Chow and I approved this message

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