The Shadow Banking System's Free Ride - Who's looking out for taxpayers?

[WhiskeyGirl]

We've written for some time about the unfair advantages the shadow banking system (notably money market funds and investment banks) enjoys as it competes with the real banking system. The shadow system operates with essentially no regulation, pays no deposit-insurance fees, and isn't saddled with mandated social missions imposed by legislation such as the Community Reinvestment Act.   

The result? Shadow banks weaken the actual banking system by using their advantages to skim off the financial services industry's most profitable business. Money market funds in particular can offer premium returns to bank deposits and promise bank-like safety--without the cost or safety of the FDIC insurance system.

Why should the shadow banking system get to access taxpayer funds and guarantees through the Federal Reserve?  Treasury?

Privatized profits, socialized losses?

If the administration wants to reform the financial system, it should start by reforming shadow banking system.

http://www.istockanalyst.com/article/viewarticle/articleid/3463686

Are Dark Pools, High Frequency Trading also part of the Shadow Banking System? 

How is the Shadow Banking System related to the Shadow Government?