Mr. Kashkari , '' Congressman , there is no question that clarity and certainty are very important for developing market confidence .
MR. MEYER
Corporate bond yields should decline with Treasury bond yields , though perhaps less if supply effects are the main reason Treasury yields fall .
MR. MEYER
In addition , the banking system and the Federal Reserve spend many millions of dollars each year to ensure and monitor compliance with complex reserve requirement rules .
MR. DUDLEY
Now , obviously what complicates that in the current environment is the Federal Deposit Insurance Corporation 's guarantee on interbank funds going forward .
At the Federal Reserve , we have sought to address financial market stresses with as minimal exposure for the U.S. taxpayer as possible .
MR. KOHN
It will always need a great amount of judgment , combined with -- as you said , Mr. Chairman -- a process by which you make that decision , to help limit the moral hazard .
In that case , the President , the Treasury Secretary , and two-thirds of the Federal Reserve Board can authorize open bank aid .
These reports complement the Blueprint for regulatory reform issued by the Treasury in March , which focused on broader questions of regulatory architecture .
MR. DUDLEY
In those areas in which the federal government , including the Federal Reserve , has applied the most force , the situation has generally stabilized or improved .
MR. DUDLEY
The interest rate paid on excess reserves -LRB- IOER rate -RRB- has not been a perfect substitute for the Treasury SFP program .
MR. DUDLEY
This is likely to lead to a rise in Treasury fails because , when general collateral repo rates are very low , the cost of shorting Treasury securities becomes negligible .
Working with the Treasury Department and the other bank regulators , the FDIC will do whatever it takes to preserve the public 's trust in the financial system .
MR. LACKER
I hope , Mr. Chairman , that the group you 've commissioned to study the meaning of unusual and exigent circumstances can explore this terrain in a little more depth .
Mr. Seligman , '' Mr. Chairman , we have reached a moment of discontinuity in our Federal and State systems of financial regulation that will require a comprehensive reorganization .
MR. DUDLEY
108 , MR. DUDLEY. , '' Well , I think the market participants would gain some comfort to the extent that the Federal Reserve as an institution indicates concern about what 's going on in the financial markets .
That oversight board includes the Secretary of the Treasury , the Secretary of Housing and Urban Development , the Chairman of the Securities and Exchange Commission , the Director of the Federal Housing Finance Agency , and the Chairman of the Federal Reserve Board .
Therefore , Treasury committed to provide $ 20 billion of TARP resources in support of a $ 200 billion Federal Reserve facility -- the Term Asset-Backed Securities Loan Facility -LRB- TALF -RRB- .
The Senior Preferred Stock Purchase Agreements signed between the Enterprises and Treasury ensure consultation or agreement with the Treasury on many aspects of the Enterprises activities .
It also created the Federal Housing Finance Oversight Board , which meets at least quarterly and includes the Secretaries of Treasury and HUD , as well as the Chairman of the SEC .
Given such market conditions , Secretary Paulson and Chairman Bernanke recognized that Treasury needed to use the authority and flexibility granted under the EESA as aggressively as possible to help stabilize the financial system .
b. Regulation of insurance companies is undertaken at the state level , not by the Treasury Department , and Treasury does not interfere in these regulatory-supervisory matters .
What specific steps has the Treasury Department undertaken to ensure that the funds are being used to accomplish this objective?A .3 .
After all , the Federal Reserve 's lending money to AIG is no different from the Treasury 's investing capital in a bank .
The FDIC is working closely and creatively with Treasury on ways to use the recent rescue law to create a clear framework and economic incentives for systematically modifying loans .
Preventing unnecessary foreclosures will be essential to stabilizing home prices and providing stability to mortgage markets and the overall economy .
And Chairman Bernanke , the Federal Reserve 's actions continue to help preserve confidence and bring stability to our financial markets and institutions .
Mrs. Biggert , '' Thank you , Mr. Chairman , and thank you for holding today 's hearing on systemic risk .
In this regard , the Federal Reserve supports the Treasury 's proposal to buy illiquid assets from financial institutions .
Despite the efforts of the Federal Reserve , the Treasury , and other agencies , global financial markets remain under extraordinary stress .
MR. CLOUSE
This system would share many of the key structural elements of the system for monetary policy implementation employed in the United Kingdom .
MR. CLOUSE
The system could include a target balance '' `` band '' '' to afford banks some flexibility in meeting their voluntary target balance .
Working with the Treasury , the FDIC , and other agencies , the Federal Reserve believes that we must take all steps necessary to minimize systemic risk .
As provided in the Act , the Federal Reserve Board and its staff are consulting with Treasury regarding the TARP and Chairman Bernanke serves as Chairman of the Oversight Board for TARP .
Next question , the Treasury and the Federal Reserve turned Goldman Sachs and Morgan Stanley into banks over a weekend .
All significant U.S. financial institutions that provide credit have some form of access to Federal Reserve liquidity facilities at this time .
MR. MADIGAN
Finally , the Federal Reserve remains unable to pay explicit interest on balances held at the Federal Reserve by the Treasury and by foreign central banks .
Chairman Cox , we had a previous hearing here in the committee on systemic risk , and we had the Chairman of the Federal Reserve here at that time and the Treasury Secretary .
MR. DUDLEY
Nine large banks announced two weeks ago that they will accept $ 125 billion of preferred stock investment from the Treasury .