On the one hand, it’s heartening to see other people corroborate SOC's thesis, first suggested in October, that there’s more common ground between the two groups than either would like to admit.
On the other hand, the other people in this case are... the Dallas Federal Reserve.
“From an economic perspective,” says a report by Dallas Fed chief Richard Fisher, “these bailouts are certainly harmful to the efficient workings of the market.”
The Tea Party/Occupy parallels were incidental to the report’s main point: More than half of the banking industry’s assets are in the hands of only five “too big to fail” banks — Bank of America, Citi, JP Morgan Chase, Wells Fargo and Goldman Sachs.
So much for the reform that was supposed to come with the Dodd-Frank law. “I am of the belief personally that the power of the five largest banks is too concentrated,” says Fisher. His solution in light of Dodd-Frank’s failure: Break up those banks.
The notion that banks should go out of business if they make stupid decisions? That’s nowhere to be found in Fisher’s 34 pages.
Add an unlikely member to the club of countries fleeing the U.S. dollar — Australia.
The government Down Under has agreed to a $31 billion currency swap with China. That makes Australia the biggest economy yet among 20 countries now bypassing the greenback in at least some transactions with China.
“The main purposes of the swap agreement are to support trade and investment between Australia and China, particularly in local-currency terms, and to strengthen bilateral financial co-operation,” says a statement from the Reserve Bank of Australia.
The buzz in currency markets this morning is that the U.K. and Japan might be next to strike deals with China.