Better Markets released a White Paper this month that details how the Dodd-Frank Act and other banking reforms over the last 10 years have, at least so far, prevented a crash of the banking system similar to the one experienced in 2008.
Dennis Kelleher, President and Chief Executive Officer of Better Markets, and Tim Clark, Distinguished Senior Banking Adviser at Better Markets and a former Deputy Director of Supervision and Regulation at the Federal Reserve Board, authored the white paper.
In the white paper, Kelleher and Clark highlight key post-crisis reforms that address why the U.S. has not experienced a crash of the banking system as happened in 2008 even as the country experiences record levels of unemployment, a severe economic contraction and unprecedented uncertainty about the economy outlook.
They also noted that while the too-big-to-fail problem is far from solved, and further work on banking and non-banking reforms is still required, particularly in light of the deregulation over the last three years, we have a stronger U.S. banking system because of the Dodd-Frank Act and the implementation of banking and financial sector reforms.
“We now have a system in which the largest banks have been required to internalize more of the costs of making it safer,” Kelleher and Clark wrote. “This has, at least so far, prevented a banking system crash, reduced the likelihood of taxpayer-funded bailouts, and lowered the cost should one be needed.”