The Community Reinvestment Act (CRA) requires banks to lend to low- and moderate-income (LMI) households in the areas where they take deposits. However, the competitive environment is much changed from when the CRA came into force in 1977, and mounting evidence suggests the CRA is either ineffective or damaging. A new study from Cato scholar Diego Zuluaga argues that there is a strong case for repealing the CRA in favor of alternative policies that better achieve its goals.
Central bankers and mainstream monetary economists have become intrigued with the idea of reducing, or even entirely eliminating, hand-to-hand currency. Yet the arguments for phasing out cash or confining it to small denomination bills are, when not entirely mistaken, extremely weak. In a new paper, Cato scholar Jeffrey Rogers Hummel argues that proponents of restricting cash appreciably oversell any advantages and ignore or understate the severe disadvantages.