Daily Archives: September 29, 2011

Claire Jones

Regulators on both sides of the Atlantic are calling on banks to strengthen their capital buffers by lowering dividends.

Britain’s Financial Policy Committee yesterday suggested as much. Today, Eric Rosengren, the president of the Federal Reserve Bank of Boston, was more explicit.

Mr Rosengren’s approach is also more interventionist. Read more

Claire Jones

Yesterday’s Financial Policy Committee statement well illustrated the bind officials find themselves in. On the one hand, they are calling on banks to build up their capital and liquidity buffers. On the other, they are desperate for them to prop up their ailing economies by lending to businesses and households.

If you look at today’s Bank of England data on broad money aggregates, then it’s easy to see why the FPC is so concerned.  Read more