NCUA Looking to Unload Taxi Medallions

January 13, 2020 at 9:10 am Leave a comment

Hello, folks.

This goes into the “don’t shoot the messenger” category, but in case you missed it, Crain’s New York Business (subscription required) reported on Friday that NCUA is looking to sell off both their New York and Chicago taxi medallion loans. The paper is further reporting that a potential buyer is private equity firm Marblegate.

We are all in somewhat unchartered water when it comes to the medallion issue, but it is likely that if NCUA sells their medallions in bulk, the resulting price will result in at least some credit unions having to write down the value of their medallion participation interest. In addition, it is at best unclear what impact the sale would have on efforts to renegotiate loan terms with cab drivers. NCUA has faced criticism from some credit unions and taxi drivers who claim it has not been flexible enough in negotiating new loan terms.

Bernanke: Fed Has Stimulus Flexibility

As an armchair economist wannabe, I have wondered for quite some time now what the Fed will do when the country once again enters an economic downturn. After all, unless you believe that the business cycle has come to an end, you should be anticipating a slowdown in economic activity within the next couple of years.

Consequently, those of you interested in this subject should take a look at this recent blog post by former Federal Reserve Chairman Ben Bernanke. In it, he argues that the Fed has the resources to provide the equivalent of a 3% drop in interest rates, even without formally dropping the target funds rate any further. Furthermore, he suggest that, maybe, just maybe, there may be scenarios under which it is acceptable for the Fed to tolerate an increase in inflation above its current target ceiling.

Entry filed under: Economy, New York State, Regulatory. Tags: , , , , , .

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Authored By:

Henry Meier, Esq., Senior Vice President, General Counsel, New York Credit Union Association.

The views Henry expresses are Henry’s alone and do not necessarily reflect the views of the Association. In addition, although Henry strives to give his readers useful and accurate information on a broad range of subjects, many of which involve legal disputes, his views are not a substitute for legal advise from retained counsel.

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