Marketwatch: Shadow banking becomes fault line for Sanders, Clinton

[villager]

A dispute over shadow banking is heating up between Bernie Sanders and Hillary Clinton as the Democratic presidential hopefuls sharpen their messages to voters ahead of the first votes of the 2016 presidential campaign.

Sanders, a Vermont senator, is slated to give a speech on Wall Street reform Tuesday afternoon, in an attempt to cast himself as the industry’s toughest cop — and to rebut criticism from Clinton’s campaign about his policies.

Sanders will reportedly say the reinstatement of the Glass-Steagall Act would aim to crack down on the so-called shadow banking system — which operates outside government bank regulators’ jurisdiction. Shadow banking refers to lending outside the banking system. Such lending can come from institutions including hedge funds, private-equity firms and money-market funds.

The International Monetary Fund blamed shadow banks — entities it says have little supervisory oversight and weak governance — for contributing to the global financial crisis in 2008. The Financial Stability Board, which was created by the Group of 20 nations, recently found the U.S. accounted for 40% of global shadow-banking assets in 2014.

Clinton opposes reinstating Glass-Steagall, which separated commercial and investment banking. And her campaign is saying Sanders doesn’t go far enough in addressing some of the biggest culprits of the 2008 crisis.

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http://www.marketwatch.com/story/shadow-banking-becomes-fault-line-for-sanders-clinton-2016-01-05

[Thinkingabout]

1. Hillary wants to enhance Dodd Frank and invoke the Voelcker rule.

Dodd Frank is already in place and with some enhancements it will be more effective in today's world.

[ish of the hammer]

2. explain the "Voelcker rule" please

for those of us who don't understand high finance.

[Thinkingabout]

3. Definition

DEFINITION of 'Volcker Rule' A federal regulation that prohibits banks from conducting certain investment activities with their own accounts, and limits their ownership of and relationship with hedge funds and private equity funds, also called covered funds.

[BlueMTexpat]

4. Google is your friend.

[ish of the hammer]

5. "volcker rule"

also sometimes called "glass-steagall lite" cause the real law might be too much for our financial overlords