The Huffington Post reports that the Obama administration, far from splitting up the too-big-to-fail banks, will allow them to get even bigger under the financial-reform law.
The nation’s four biggest banks can grow even bigger, with the potential to add at least another trillion dollars onto their balance sheets before they even reach the limits imposed by the Obama administration, according to an administration study released Tuesday…
“I said the banks won,” said Simon Johnson, a former chief economist at the International Monetary Fund who now teaches at the M.I.T. Sloan School of Management and is a HuffPost contributing business editor. “It just tells you what the Treasury wants, and what they’re telling you is they’re going to cook it to let these banks expand.”
Treasury Secretary Timothy Geithner heads the Financial Stability Oversight Council, which produced the study and accompanying recommendations. They’re intended to guide regulators as they craft the rules that will attempt to restrain the growing concentration in the nation’s financial system.
The bigger they get, the more powerful they get and the more dangerous they get.
— The News Corporation phone-hacking scandal is getting uglier.
The Guardian reports that one of the main culprits says he was commissioned by the News of the World‘s head of news to illegally hack into people’s phones. That brings the scandal that much closer to execs like Andy Coulson and now-Wall Street Journal head Les Hinton.
Brian Cathcart on what this means (h/t Jack Shafer):
The phone hacking scandal has entered a new phase and a number of very powerful people, up to and including David Cameron and Rupert Murdoch, should now be very worried. Glenn Mulcaire’s reported confirmation that a senior News of the World news editor, Ian Edmonson, commissioned him to hack phones elevates a nagging problem into a national political crisis.
The problem is most acute at the Murdoch press, which must now defend itself against the charge that its staff hacked phones with the blessing of management. It also has to explain why it has insisted for four years that the management didn’t even know. The senior executives who need to justify positions which they have previously adopted in public but which now look very dubious indeed include Les Hinton, now the CEO of Murdoch’s US press empire, Rebekah Brookes, chief executive of News International, Colin Myler, editor of the News of the World, and Tom Crone, News International’s legal affairs boss.
Of course Andy Coulson, the prime minister’s press adviser, is also in what we might call a delicate position, which means the David Cameron himself is tainted. Why did Cameron appoint this man, trust him and stand by him? It now looks like a gross and stubborn misjudgement by a man who is supposed to get things right.
Rupert and James Murdoch are in the same position. What did they know? Did they tolerate this? Are they responsible for creating the conditions in which it happened? Why were they not more energetic in pursuing the problem to its source, once it was exposed?
— The Financial Times is on fire—online, anyway.
The paper saw its digital subscribers skyrocket 71 percent in 2009 to nearly 207,000 total, reports PaidContent. And those subscribers are paying good money—about $250 a year ($21 a month) for a basic subscription or $390 ($32.50 a month) for one that includes its Lex column.
This despite the fact that it’s made its offerings easier to access by giving readers five stories a day free via Google.
The FT is a specialty paper with a very rich audience, but it’s interesting—and good news—all the same.
Ryan Chittum is a former Wall Street Journal reporter, and deputy editor of The Audit, CJR’s business section. If you see notable business journalism, give him a heads-up at rc2538@columbia.edu. Follow him on Twitter at @ryanchittum.