2009 0305 - GOV (House) - Perspectives on Systemic Risk
- 2009 0305 - GOV (House) - Perspectives on Systemic Risk
Crisis in Confidence
Terri Vaughan: (NAIC CEO - IA)
- (p25) ... I am wondering, again, just sort of thinking through it, whether it is sending the wrong signal to the marketplace, and particularly, I think about consumers, is it sending the wrong signal to consumers about the capital that is in these companies and how strong these companies are.
- One of my colleagues likes to say the greatest risk we have right now is a crisis of confidence. It is that people are scared.
- We know our policyholders are scared.
- That is one of the reasons that the insurance regulators have really been struggling with what kind of reporting requirements should we be having in this environment right now where the markets are not anything that we have ever lived with before, not in my lifetime.
Gary ACKERMAN (D-NY)
- We cannot address or we certainly cannot legislate the confidence in the market.
- We are going to do a lot of cheerleading to do that.
- (p26) - Bachus: Now, we are asking the Fed—Mr. Bartlett, I think you will agree that the President’s Working Group in 1988 and then this Congress in 1991 actually directed the Treasury and the Fed to look at systemic risk and see what sort of powers they ought to have to deal with it.
- (p28) - (Terri) VAUGHAN: We have been the recipient of several GAO studies, thank you very much, that pointed to problems in our system, and that we then went and fixed.