Lalita Clozel
speaker
117 appearances
3 recordings
1 series
first heard Mar 2018
last heard Sep 2019
Lalita Clozel’s voice in public audio — every appearance, attributed to the second.
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Appearances
And that's why a lot of the laws that limit interest rates for loans are called payday lending laws.
So you have a new generation of players that are coming in that are offering loans that are maybe installment loans paid to be paid out over a few months or loans through apps or online loans and they don't look like a traditional storefront payday lender but for regulators the same questions arise and
The regulators want to make sure that these lenders are verifying that the borrower is going to be able to repay, that they're just doing their proper due diligence when they're underwriting the loans.
And so that's why you're seeing a lot of scrutiny over these new players in recent years.
Exactly.
And that's why the banks, they're hearing encouragement from the banking regulators that it's fine to make those loans again, but they want more.
They would like to have a very firm, concrete assurance from their regulators that if they engage in those loans again, they're not going to get in trouble.
Thanks for having me, JR.
So the counter-cyclical capital buffer allows the Fed to increase capital requirements when the economy is doing really well and there are potential signs that it might not last and there are risks rising in the economy.
So the idea is that you increase capital requirements, make banks sock away more capital so that when a downturn hits, then the Fed can then decrease those capital requirements
And at that moment, allow the banks to lend more at a time when their lending is most needed because they're, you know, at times of recession that can bring about a credit crunch.
Right.
And it didn't exist during the 2008 financial crisis.
It's a pretty new tool.
It was created after by international regulators.
There are other countries that have turned it on, like Sweden and the UK.
And in the U.S., so far, it's never been turned on.
Several Fed officials feel that capital requirements and capital levels in the system are about rights.
So they feel like we don't need to turn the dial up right now, even though the economy's been doing pretty well.
And not all Fed officials agree on that.
Showing 41–60 of 117 · page 3 of 6
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