Coronavirus Economy: Are Big Banks On The Verge Of Financial Crisis?
Could the U.S. be on the verge of a financial crash? That’s what Frank Partnoy considers in a recent article in The Atlantic. He joins us to talk about the possibility of a financial crash and the risks big banks are taking.
Frank Partnoy, law and business professor at UC Berkeley. International research fellow at Oxford University. Author of The Atlantic article titled “The Looming Bank Collapse.” (@FrankPartnoy)
Rep. Katie Porter, Democratic representative for California’s 45th Congressional District. (@RepKatiePorter)
From The Reading List
The Atlantic: “The Looming Bank Collapse” — “After months of living with the coronavirus pandemic, American citizens are well aware of the toll it has taken on the economy: broken supply chains, record unemployment, failing small businesses.”
Politico: “Quietly cashing in on coronavirus” — “At least four lawmakers or their families have benefited directly from the multibillion-dollar loan program Congress set up to support small businesses rocked by the pandemic.”
Washington Post: “The Fed is cracking down on big banks to guard against risk posed to the financial system from coronavirus” — “For the first time since the aftermath of the Great Recession, the Federal Reserve is putting new restrictions on how the country’s biggest banks spend capital, with an eye toward protecting the financial system from risks to the economy posed by the coronavirus pandemic.”
CNN: “Big banks stand to earn hundreds of millions from PPP loan fees” — “America’s largest banks are set to earn hundreds of millions of dollars in fees paid out by the federal government under its Paycheck Protection Program, according to S&P Global.”
Wall Street Journal: “Recession Forces Spending Cuts on States, Cities Hit by Coronavirus” — “State and local governments from Georgia to California are cutting money for schools, universities and other services as the coronavirus-induced recession wreaks havoc on their finances.”
Washington Post: “Fed officials raised concerns in June that U.S. could enter a much worse recession later this year if coronavirus cases continued to surge” — “Federal Reserve officials raised concerns about additional waves of coronavirus infections disrupting an economic recovery and triggering a new spike in unemployment and a worse economic downturn, according to minutes released Wednesday by the central bank about its June 9-10 meeting.”
New York Times: “Federal Reserve’s Main Street Lending Program Attracts Few Big Banks” — “The Federal Reserve Bank of Boston on Wednesday released a list of lenders that have signed up for the central bank’s midsize business lending program and are willing to make loans to new customers through the initiative.”
The Conversation: “Lessons from the 2008 financial crisis for our coronavirus recovery today” — “In this sixth and final episode of Recovery, a series from The Anthill Podcast exploring how the world rebuilt after historic crises, we look at the 2008 global financial crisis.”
FiveThirtyEight: “In 2008, Everyone Thought The Recession Was Bad. But in 2020, Many Americans’ Views Depend On Their Party.” — “The U.S. economy is objectively awful right now. The unemployment rate is at levels not seen since the Great Depression and this quarter’s decline in gross domestic product is expected to be the worst on record.”
This article was originally published on WBUR.org.
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