AFR Profile picture
Mar 13 5 tweets 2 min read
The collapse of Silicon Valley Bank and Signature Bank have something in common: they both benefited from deregulation under the #BankLobbyistAct in 2018 1/5
Congress passed the law but the Trump-era regulators pushed it even further, giving authorities less oversight of these large-ish banks. Now we need action to reverse those changes and make others 2/5 ourfinancialsecurity.org/2023/03/news-r…
People like @SenWarren warned of this outcome back in 2018. Check out her op-ed in The New York Times today. 3/5 nytimes.com/2023/03/13/opi…
There's been a forceful response that stands a good chance of stopping any contagion. The bank shareholders get nothing; executives have lost their jobs. Both of those things are good: you take risks, you don't always win 4/5
But let's also bear in mind that we should take the economic stresses of everyday people as seriously as we do stresses in the financial system. 5/end

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More from @RealBankReform

Mar 14
GOOD NEWS: Authorities looking into possible executive malfeasance in #SiliconValleyBankCrisis

The executives lost their jobs, shareholders were zeroed out --> There was no bailout a la 2008

But we still need systemic change 🧵 1/6

nytimes.com/2023/03/14/bus…
Thanks to the #BankLobbyistAct back in 2019, and the Trump-era Fed's further deregulation, the Fed took its eyes off large banks like SVB. AFR fought against that tooth and nail. 2/6
The government moved decisively to avoid a panic by guaranteeing deposits. Banks that benefit from that now need tougher supervision. AFR's Renita Marcellin told the NYT ... 3/6
Read 6 tweets
Jan 10
🚨 NEW REPORT 🚨

The subprime corporate credit market, which includes private equity’s fave, leveraged lending and CLOs, has hit $5 trillion in the US.

This problem portends bring slower growth, job losses, and possibly instability in parts of the financial sector.

🧵1/10
This lending seldom goes to productive uses, relies on sketchy accounting, and is often very opaque.

It's often to finance private equity buyouts refinance existing debt, or suck cash out of companies.

And it supports monopoly power, by driving corporate consolidation. 2/10
The odds of a 2008-style crisis are low but the risks of damage are high.

This debt has – a redistribution of money towards Wall Street – has left companies and workers in a worse position to handle a slowing U.S. economy. 3/10
Read 13 tweets
Oct 25, 2021
Politico's @vtg2 has a brilliant scoop that underscores why we need Saule Omarova as head of the OCC 🧵 1/7 politico.com/news/2021/10/2…
Here we learn that the last Trump OCC boss, @BrianBrooksUS gave a secret legal imprimatur to allowing banks to hold cryptocurrency -- a wild-west asset if there ever was one -- under certain circumstances. 2/7
On on level, it's garden-variety Trump-era corruption. Brooks was chief legal officer @coinbase before becoming Acting Comptroller, and after he left, he was CEO of @binance for 3 months (Why the short tenure?) 3/7
Read 7 tweets
Oct 21, 2021
Today, we will be clipping videos from the Senate Banking, Housing, and Urban Affairs committee hearing on “How Private Equity Landlords are Changing the Housing Market.”

Follow along in this thread, or watch the hearing live, starting at 10:00am:
banking.senate.gov/hearings/how-p…
@SherrodBrown opens: "in plain English, that meant take advantage of the foreclosure crisis... to give Wall Street billionaires the chance to buy up homes for less than they're worth and rent them out at a steep profit."
@SherrodBrown "It's a variation on the same theme no matter the industry.... PE profits depend on squeezing every last nickel from workers and renters, without any kind of real investment in their employees or their communities."
Read 13 tweets
Oct 20, 2021
Today, we will be clipping videos from the Senate Banking, Housing, and Urban Affairs subcommittee hearing on “Protecting Companies and Communities from Private Equity Abuse.”

Follow along in this thread, or watch the hearing live, starting at 2:00pm: banking.senate.gov/hearings/prote…
Shirley Smith, former sales manager at Art Van Furniture and leader with @forrespect opens: "working at Art Van was like my own little slice of the American Dream, until the PE firm T.H. Lee came in and broke up our family."
Shirley Smith continues: "I am here today to show you the human toll of Wall Street's greed. Our elected leaders... I have to ask you why billionaires should be allowed to do this and destroy the fiber of America?"
Read 10 tweets
Oct 16, 2021
Biden nominated the brilliant immigrant Saule Omarova to oversee big banks. Opposition is a disgraceful mix:

➡️ Repub Red-baiting
➡️ #WallStreet scaremongering
➡️ Racism and sexism
➡️ Stupidity

Her real sin to them is speaking truth to Wall Street’s power

Here’s a 🧵 1/16 Image
Omarova was born in Kazakhstan and emigrated to the US as Communism collapsed. Smart as they come, she went from a small town in central Asia to an American PhD, law degree, banking law firm of @DavisPolkReg, Bush Treasury and academia. Wow. 2/16
A senior Republican and bank lobbyists slimed her with McCarthy-style tactics.

@SenToomey, the top R on the Senate Banking Committee demanded her undergraduate thesis from a Moscow university

@PatrickMcHenry, top R on House Financial Services Committee, joined in too

3/16 Image
Read 17 tweets

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