Fed's Dudley floats even broader revamp of wholesale funding
February 2, 2013 1:00 AM EST
The United States could adopt even broader reforms of the wholesale funding markets than currently being considered, including forcing firms to rely more on longer-term funding or expanding the U.S. Federal Reserve's backstop, an influential Fed official said on Friday.
New York Fed President William Dudley warned that extensive activity in the money markets and tri-party repo markets takes place without proper safeguards against runs and fire sales, and he urged U.S. lawmakers to take a closer look.
Without endorsing a particular path, he suggested the government could curtail short-term wholesale finance, dissuading financial institutions from using such funding, or it could decide to extend access to the Fed's discount window to firms that are "much more socially useful than others."
"Regardless of where we come out on these questions, we must make the basic structure of the wholesale funding market as sound as possible," Dudley told the New York Bankers Association, according to prepared remarks.
"Thus, we must push ahead with tri-party and money fund reform."
(Reporting by Jonathan Spicer; Editing by Chizu Nomiyama)
Join the Conversation
- Tourre on stand says email in SEC case 'not accurate'
- Syrian authorities blocking access to needy in Homs - Red Cross
- Faith in European Union at low ebb, EU poll says
- Former UBS banker gets 18 months, $1 million fine, for muni bid-rigging scheme
- U.S. judge halts challenges to Detroit's bankruptcy bid
- Revealed: Vladimir Putin Plotting To Invade Europe – Report
- 5 Proofs Russia is Geared-Up for Shooting War with U.S. and Can Win Future Nuclear Showdown
- Target’s ‘Surprise Doorbusters’ Black Friday 2014 Deals On TV Sets, Entertainment Centres, DVD Players And More
- IKEA Black Friday 2014 Ad Includes Discounts On Home Furnishings, Appliances, Kitchen Designs, Beds, Sofas, Mattresses And Toys
- T-Mobile’s Black Friday 2014 Deals On Apple iPhone 6, Samsung Galaxy Note 4/Edge, Nexus 6, HTC One M8, LG G3, iPad Air 2 And Mini 3
- ISIS Drug Transit From Afghanistan To Europe Confirmed By Russia: Money Goes Into Terror Funding And In New Recruitments
- Bill Clinton At It Again, Caught By Camera In Jerusalem Peeking At Woman’s Breast