Slideshow

'The freaks are coming out of the woodwork': Comments of the week

November 15, 2018 10:00 PM

Readers respond to the burgeoning debate over brokered deposits, consider the Democratic presidential hopefuls for 2020, weigh the Consumer Financial Protection Bureau's latest regulatory efforts and more.

Senator Heidi Heitkamp, a Democrat from North Dakota, listens during a news conference after a weekly Democratic luncheon meeting at the U.S. Capitol in Washington, D.C., U.S., on Tuesday, July 11, 2017. Majority Leader Mitch McConnell said he's delaying the Senate's August recess by two weeks after divided lawmakers have been unable to agree on how to revise health-care legislation he proposed to replace Obamacare. Photographer: Andrew Harrer/Bloomberg

Andrew Harrer/Bloomberg

On the impact of several moderate Democrats who supported the regulatory relief law getting defeated in the midterms:

"Let's be honest here, the so called moderate Democrats only supported bills that they thought would get them re-elected."

Related: Purge of moderate Dems will haunt financial industry

The White House in Washington, DC, US, on Wednesday, Nov. 9, 2022. The Republican wave that was supposed to undo Joe Biden's presidency failed to arrive as GOP candidates were projected to dominate Tuesday's midterm elections, with polls showing voters bitter about the state of the economy. Photographer: Graeme Sloan/Bloomberg

Graeme Sloan/Bloomberg

On a roundup of the top Democratic contenders for the 2020 presidential race:

"The freaks are coming out of the woodwork."

Related: Big-bank breakups, postal lending and more: 2020 Dem hopefuls' financial agendas

Pedestrians walk by a Payday Advance shop on El Cajon Blvd. in San Diego, CA on Tuesday, November 23, 2004.(Photo by Sandy Huffaker/Bloomberg News)

On an argument that Operation Choke Point might be only part of the story for why some banks have severed tied with payday lenders:

"No skepticism needed. Black and white difference in a bank being punished for bad behavior and an entire legal industry being banned from banking services because an unelected regulator does not like the industry. it is not a regulator's decision to make but rather the voters in the states offering the service to, generally, consumers who do not have access to credit from any other legal source. The fees are high--likely too high but they do provide financing to people who need it."

Related: Beware the tidy narrative about Operation Choke Point

rubber stamps marked with regulations and rules

Wolfilser - stock.adobe.com

On a review of the banking industry's top priorities when it comes to overhauling the Community Reinvestment Act:

"The first reform for CRA should be to exempt small and intermediate small banks. These banks will simply fail if they do not meet the needs of their communities. This change will go along way in allowing small community banks to continue to meet their community needs without the additional regulatory burden. Requiring a small bank to expand its community to include an LMI area simply to meet regulatory requirements is not good policy."

Related: What bankers want from CRA reform

Representative Maxine Waters, a Democrat from California and ranking member of the House Financial Services Committee, questions witnesses during a hearing in Washington, D.C., U.S., on Wednesday, Oct. 25, 2017. The hearing was titled Examining the Equifax Data Breach. Equifax Inc., already reeling from American probes into the loss of data on 145.5 million customers in a computer hack, will face an investigation in the U.K., where 694,000 consumers had information stolen. Photographer: Andrew Harrer/Bloomberg

Andrew Harrer/Bloomberg

On news that Rep. Maxine Waters, who is expected to take over as chair of the House Financial Services Committee next year, intends to examine President Trump's ties to Deutsche Bank:

"I would never want to remove the House's ability to launch investigations. However, it is a shame that this ability is now being used solely as a political weapon. Perhaps there is a way to make politician foot some of the bill. Currently, there is no accountability for wasting time and money. If the investigation is found meritless, Waters, either personally or with the support of her political party should be on the hook to repay any taxpayer funds spent in such a futile reckless manner."

Related: Maxine Waters vows scrutiny of Trump-Deutsche Bank ties if chair

Mick Mulvaney, director of OMB and acting CFPB director

Mick Mulvaney, director of the Office of Management and Budget (OMB), listens during a press briefing at the White House in Washington, D.C., U.S., on Friday, Jan. 19, 2018. Federal government funding runs out at midnight Friday. Legislation to extend the deadline passed the House on Thursday and is set for a showdown in the Senate Friday, in which Democrats are poised to block the bill. Photographer: Andrew Harrer/Bloomberg

Andrew Harrer/Bloomberg

On the Consumer Financial Protection Bureau's efforts to define the term "abusive" after years of enforcing the standard without a strict definition:

"Completely redundant. Since when is a practice 'Abusive' which is not also 'Unfair' or 'Deceptive' or both? Why not Egregious? Why not Fraudulent? Why does congress not fund agencies to enforce existing regulations as opposed to creating redundant agencies with vague mandates and open ended checkbooks? Answer - it gives the appearance of 'doing something'. Perhaps better oversight of existing agencies would have been better for the consumer."

Related: CFPB walks tightrope in effort to define ‘abusive’ practices

Jelena McWilliams, member of the board of directors with the Federal Deposit Insurance Corporation (FDIC) nominee for U.S. President Donald Trump, listens during a Senate Banking Committee confirmation hearing in Washington, D.C., U.S., on Tuesday, Jan. 23, 2018. If confirmed by the Senate, McWilliams would join other Trump appointees who are crucial to his goal of rolling back rules for the financial industry. Photographer: Andrew Harrer/Bloomberg

Andrew Harrer/Bloomberg

On an argument that the Federal Deposit Insurance Corp. should reconsider its rate cap methodology, which can harm institutions trying to serve the underbanked:

"Stunningly straightforward logic. As a consumer, I shop rates in all 50 states. Today that may not be normal, but it is increasingly becoming normal and for the FDIC to impose 'horse and buggy' thinking on an internet based world is to ensure that things will go off the rails at an inopportune time. FDIC should reform this now so that banks can adjust before this becomes an issue."

Related: FDIC’s rate caps threaten efforts to serve the underbanked

A man films the exterior of the Federal Deposit Insurance Corp. headquarters in Washington, D.C., U.S., on Tuesday, Sept. 29, 2009. The FDIC, seeking to replenish deposit reserves as banks fail at the fastest pace in 17 years, today voted to unanimously to have lenders prepay fees through 2012 raising about $45 billion. Photographer: Andrew Harrer/Bloomberg

Andrew Harrer/Bloomberg

On an argument that regulators should proceed carefully in considering reforms to brokered deposit rules given the damage of the S&L crisis:

"A good explanation of why brokered deposits got a bad reputation in the 1980s. But brokered deposits today are fundamentally different. Depositors choose them for safety. Banks take them as part of a branchless strategy, not to invest in high risk bonds for short term profits. They will increasingly replace core deposits as surely as cards replaced paper checks."

Related: A cautionary tale on brokered deposits