And  5  See Paul Tucker (2009), “The Crisis Management Menu,” speech at the SUERF, CEPS and Belgian Financial Forum Conference: “Crisis Management at the Cross-Roads,” held in Brussels, Belgium, November 16. 4  BIS Review 12/2010  loans to consumers too expensive? The tendency by Washington to micromanage can harm an economy that desperately needs a competitive, vibrant, sustainable banking system.
Rule-based regimes on issues of capital and liquidity – even on scope – are inevitably crude and imperfect. And to be effective, these rules would need to reduce systemic risks meaningfully. Still, this regime strikes me as superior to one in which our financial firms are micromanaged as quasi-public utilities, subject to the changing preferences of Washington and immunized from real competition.