The Federal Financial Forum

Presentation to the Bishop Ranch Forum
San Ramon, California
By John C. Williams, President and CEO, Federal Reserve Bank of
San Francisco
For delivery on Feb. 8, 2012
Download PDF Version (34KB)

President Williams presented similar remarks to The Columbian’s 2012 Economic Forecast Breakfast in Vancouver, Washington, on January 10, 2012.

The Federal Reserve and the Economic Recovery

Good morning. I want to thank Alex and all of you for coming to the forum this morning. I get to travel all over the world to give talks, but I’ll admit it’s nice to be able to just jump in my car and not have to go through airport security and delays to be with you today.

From: Gizmodo

The banking industry often employs two-step security measures—similar to Google Authenticator—as an added layer of protection against password theft and fraud. Unfortunately, those systems have just been rendered moot by a highly-advanced hack.

The attack, know as the Man in the Browser method, works like this. Malicious code is first introduced onto the victim’s computer where it resides in the web browser. It will lay dormant until the victim visits a specific website—in this case, his bank’s secure website. Once the user attempts to log in, the malware activates and runs between the victim and the actual website. Often the malware will request that the victim enter his password or other security pass into an unauthorized field, in order to “train a new security system.” Once that happens, the attacker has full access to the account.

From: NPR

NPR and ProPublica have found that Freddie Mac, the giant government-owned mortgage company, has been placing financial bets against homeowners. Specifically, Freddie Mac has made targeted investments that pay off if homeowners are unable to refinance their mortgages. At the same time, Freddie has been making it harder for many homeowners to get new loans.

Transcript

MELISSA BLOCK, HOST:

Jan. 24 (Bloomberg) — The U.S. Consumer Financial Protection Bureau may weigh size or market share in exempting community banks from its rules to shield them from the greater regulatory burdens facing their larger rivals.

Richard Cordray, the former Ohio treasurer and attorney general appointed to head the consumer bureau Jan. 4, touted the idea of exclusions for smaller lenders in a conference call organized by the Independent Community Bankers of America.

“The bureau will be considering two-tiered regulatory requirements and exemption thresholds as it writes regulations so that community banks will be able to conduct their business without overly burdensome regulatory requirements,” the Washington-based trade group said in its internal newsletter, citing Cordray’s comments during the Jan. 12 call.

(Reuters) – Regulators said on Wednesday they believe their agencies could implement a ban on proprietary trading without crushing banks’ ability to buy and sell securities on behalf of customers.

The 2010 Dodd-Frank financial oversight law’s Volcker rule prevents banks that receive government backstops such as deposit insurance from making risky trades with their own funds.

Supporters of the crackdown say it will make the financial system safer and more stable.

Regulators, who released a proposed plan in October, have been under pressure from the banking industry since then, and last month extended the comment period into February to allow more time for additional commentary.