Janet Yellen Urges Continued Work for Resilient Financial System Amidst Market Turbulence
In a recent Treasury markets conference in New York, U.S. Treasury Secretary Janet Yellen emphasized the importance of maintaining a resilient financial system through thoughtful regulation and resisting efforts to reduce bank capital requirements. Yellen highlighted the positive impact of reforms implemented post-2007 financial crisis in helping the system withstand challenges such as the pandemic and regional bank difficulties.
Yellen stressed the ongoing need to build and sustain a strong financial system, stating that declaring victory is not an option. She emphasized the critical role of a resilient financial system in supporting a robust economy, urging for careful regulation even in the face of opposition from those seeking to relax policies.
Since taking office in January 2021, Yellen has prioritized financial stability to ensure a system that benefits households, businesses, and overall prosperity. This includes a focus on safe financial institutions, market utilities, and protections for investors and consumers. Yellen cited the importance of appropriate regulation in fostering innovation and growth within the financial sector.
Despite initial concerns that regulations like the Dodd-Frank Act would stifle innovation and economic growth, Yellen pointed out that these fears were unfounded. The higher-quality capital mandated by the law enabled banks to provide crucial credit to households and businesses during the pandemic, demonstrating the value of prudent regulation.
In summary, Yellen's remarks underscore the ongoing need for regulatory vigilance to maintain a resilient financial system that can weather market challenges and support economic growth. It serves as a reminder of the importance of thoughtful regulation in safeguarding the stability and prosperity of the financial sector.