bank run blog

Sen. Jack Reed, chairman of the Senate securities, insurance and investment subcommittee, recently raised questions about the actions the Fed has taken, in the Bear Stearns bailout and other emergency dicta. Although Reed did not specifically criticize the Fed, Reuters reported today that Reed summed up his concerns about the central bank’s actions;

“I think there should be a moment of soul-searching among all the regulators about what they have done in the last several months and years and how they can improve dramatically their regulation.”

The Senator said that there is a “critical need” to modernize the banking regulatory structure that “requires not only reviewing the authority of individual regulators, but also reviewing the way they undertake regulation.” Reed called for senate hearings saying, “This is a very serious situation, there is still a huge uncertainty in the marketplace. As a result, we don’t have the luxury of sitting around and waiting until things settle down. We have to get to work.”

Reuters: Senator urges finance regulations review