Time's Foroohar Responds to Treasury: Our Financial System Is Not Stronger Photo-illustration by Ji Lee for TIME. Photographs from Getty Images. Bull: Jan Cobb Photography. Confetti (2): Brian Hagiwara, Lauren Nicole It seems that the Treasury Department is in agreement with the core premise of TIME's cover story this week. In a blog posted on the department's website Friday, Deputy Assistant Secretary for Public Affairs Anthony Coley notes that while "unprecedented actions" were needed to prevent financial collapse in 2008, there is "still more to do to protect taxpayers, consumers and our financial system" before we can honestly say that our economy is no longer at risk. As I put it in my piece: "The truth is, Washington did a great job saving the banking system in "08 and "09 with swift bailouts that averted even worse damage to the economy. But it has done a terrible job of re-regulating the financial industry and reconnecting it to the real economy. To respond to some of the key points Mr. Coley raises: While the creation of the Consumer Financial Protection Bureau was a great step forward, it hasn't changed the underlying business model of many of the largest banks, which still make the majority of their profits from trading operations rather than plain vanilla lending. Nor has it hindered the ability of Wall Street to continue to take opaque trading risks that compromise the integrity of our financial system. Many of these risks are due to loopholes in Dodd-Frank created by vigorous banking industry lobbying. MORE: The Myth of Financial Reform While Dodd Frank has, as I write in the piece, created "something of a roadmap" to wind down banks, most experts believe that it's still unclear how the rules would work in practical terms, especially given that the biggest banks are now larger - rather than smaller - than they were before the crisis. The majority of reform minded economists believe that breaking up banks to make them both simpler and smaller is the best way to reduce risk in the financial system. To that point, while it's true that the US banking system is relatively small as a percentage of GDP compared to Europe and Japan, the US financial sector is not. What's more, the size of the global shadow banking sector has actually grown by $5 trillion since before the financial crisis, reaching a whopping $67 trillion in 2011, according to the Financial Stability Board. For more, please see page eight of this report. While I agree with Mr. Coley's assertion that many - though, it must be said, not all - of the largest banks have offloaded risky assets and increased the level of risk-absorbing capital since the crisis, it's important to consider context. Raising Tier 1 capital by 70% may sound impressive, but it has been raised from a base of almost nothing relative to risk - which means that this "accomplishment" still leaves much work to be done. For a broader understanding of new national and international capital requirements and how easy it is to game them in order to provide the illusion of financial stability, I would encourage readers to look at FDIC vice-chairman Thomas Hoenig's April 2013 speech entitled "Basel III Capital: A Well-Intended Illusion." On derivatives, I agree that a tremendous amount has been done to bring risky trades into the light since the financial crisis. And as I mention in the piece, nearly all of the credit for that goes to CTFC chairman Gary Gensler. Were it not for former Treasury Secretary Geithner's decision to exempt foreign exchange derivatives from the Dodd-Frank rules, I believe we'd be even further along in this process. I think the key point of difference between Mr. Coley's view and my own is that while it's true that banks may individually be stronger than they were before the crisis, our system as a whole is not. Banking has not been re-moored in the real economy. And until it is, I fear that our recovery - and ultimately our economy - will continue to be at risk.