{"id":194405,"date":"2008-09-25T23:09:00","date_gmt":"2008-09-26T04:09:00","guid":{"rendered":"https:\/\/www.panix.com\/~msaroff\/40years\/2008\/09\/25\/the-seeds-of-the-next-crash-have-just-been-sown\/"},"modified":"2008-09-25T23:09:00","modified_gmt":"2008-09-26T04:09:00","slug":"the-seeds-of-the-next-crash-have-just-been-sown","status":"publish","type":"post","link":"https:\/\/www.panix.com\/~msaroff\/40years\/2008\/09\/25\/the-seeds-of-the-next-crash-have-just-been-sown\/","title":{"rendered":"The Seeds of the Next Crash Have Just Been Sown"},"content":{"rendered":"<p>The <a href=\"http:\/\/www.reuters.com\/article\/innovationNews\/idUSN2260477720080922\">Federal Reserve just eased regulations on minority ownership of banks<\/a>, raising the percentage of stock ownership allowed to be raised <span style=\"font-weight: bold;\">without<\/span> requiring registration as a bank holding company&#8221;<\/p>\n<blockquote><p>Key changes in the guidelines include allowing an investor to buy up to a 15 percent voting stake instead of the previous 9.9 percent limit. Investors can also buy up to 33 percent total equity interest, including voting and non-voting shares, instead of the 25 percent prior limit.<\/p><\/blockquote>\n<p>Allowing greater ownership before regulation, reminiscent of the S&amp;L crisis, when many of these institutions were purchased by developers, who then <span style=\"font-weight: bold;\">lent to themselves at unrealistically attractive rates<\/span>.<\/p>\n<p>Of course, these days, it won&#8217;t be real estate developers, but private equity firms who can use this to exert influence over banks for capital.<\/p>\n<p>Case in point, <a href=\"http:\/\/www.bloomberg.com\/apps\/news?pid=20601087&amp;sid=aALYF8DZTrK4&amp;refer=home\">the founder of private-equity firm J.C. Flowers &amp; Co., surprisingly enough a guy named J. Christopher Flowers, is buying the First National Bank of Cainesville in Missouri<\/a>.<\/p>\n<p>Not enough bullets.<\/p>\n<p>H\/T <a href=\"http:\/\/calculatedrisk.blogspot.com\/2008\/09\/fed-changes-bank-investment-guidelines.html\">Calculated Risk<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The Federal Reserve just eased regulations on minority ownership of banks, raising the percentage of stock ownership allowed to be raised without requiring registration as a bank holding company&#8221; Key changes in the guidelines include allowing an investor to buy up to a 15 percent voting stake instead of the previous 9.9 percent limit. Investors &hellip;<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1004,985,982],"tags":[],"class_list":["post-194405","post","type-post","status-publish","format-standard","hentry","category-finance","category-regulation","category-stupid"],"_links":{"self":[{"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/posts\/194405"}],"collection":[{"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/comments?post=194405"}],"version-history":[{"count":0,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/posts\/194405\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/media?parent=194405"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/categories?post=194405"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/tags?post=194405"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}