The swamp expands…
THE FEDERAL RESERVE’S vice chair for supervision is arguably the most important financial regulator in the federal government. No agency has greater oversight responsibility of U.S. financial institutions than the Fed. And the vice chair influences what kinds of trades those institutions can make, how they must prepare for unexpected losses, and what punishment to mete out when banks fail to uphold the law.
Hedge funds and private equity firms are sometimes called “shadow banks” because they exist outside the regulatory perimeter, even though they engage in bank-like lending and investment activities.
They want to keep it that way. And President Trump’s expected nominationof Randal Quarles to the vice chair’s role is about as close a guarantee as the shadow banking sector can get that the feds won’t be bothering them any time soon.