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Financial Regulatory Reform
Comments on the Financial Reform Legislation, from both sides.
“This is a tremendous day,” said Dodd. “After great debate, we have produced a strong Wall Street reform bill that will fundamentally change the way our financial services sector is regulated.
“Over the past two years, America has faced the worst financial crisis since the Great Depression. Millions of Americans have lost their homes, their jobs, their savings and their faith in our economy.
“The American people have called on us to set clear rules of the road for the financial industry to prevent a repeat of the financial collapse that cost so many so dearly.
“We have succeeded in creating an office to ensure American consumers get the clear, accurate information they need to shop for mortgages, credit cards, and other financial products, and protect them from hidden fees, abusive terms, and deceptive practices.
“We found a way to end too big to fail bailouts, ensuring that no financial institution will ever be capable of bringing down the economy.
“We closed loopholes in regulations and required greater transparency and accountability for over-the-counter derivatives, asset backed securities, hedge funds, mortgage brokers and payday lenders.
“I am proud of this bill, and I am proud of the open and transparent process that led to such a successful result.”
Republican Senate Minority Leader Mitch McConnell (KY):
“Americans are in no mood to have Washington tell them, ‘trust me.’ And when Democrats in Washington claim that yet another 2,000-page bill and massive new regulations on consumers are the solution to the failings of Wall Street, they want them to prove it. So when the chief sponsor of the Wall Street bill says that ‘no one will know’ if their bill works until it’s already implemented, it doesn’t inspire confidence.
“Everyone recognizes the need to rein in Wall Street to prevent another crisis. And there are reforms we agree on that will benefit taxpayers. But while we will review this latest version carefully, it’s not encouraging that a bill that was supposed to address the problems of Wall Street and protect consumers is supported by the biggest banks, opposed by small business owners and still fails to address the government sponsored enterprises that were the root cause of the problem.”
Republican Senator Judd Gregg (NH), a member of the Senate Banking Committee:
“Nearly two years after the onset of one of the most serious economic meltdowns in our nation’s history, we finally have wrapped up conference proceedings on the Majority’s financial regulatory reform bill. Ironically, the most remarkable feature of this supposedly comprehensive measure is its failure to substantively address the root causes of the 2008 crisis – shoddy underwriting practices and the government sponsored enterprises, Fannie Mae and Freddie Mac. The legislation also includes extraneous provisions which have little to do with preventing another financial crisis, such as the new Consumer Protection Agency, and more to do with carrying out the cause of the moment for politically driven special interest groups. Furthermore, the provisions on derivatives, capital requirements and the Volcker rule will lead to less lending, reducing the ability of American families and small businesses to access credit at a reasonable cost.
“In an effort that should be geared toward correcting deficiencies in our regulatory structure, and during a time when we should be focused on economic recovery, this legislation is a failure on both counts. It will not encourage much-needed stability and confidence in our financial markets. It will not significantly reduce systemic risk in our financial sector.
“On top of our country’s mounting debt and deficits and the Administration’s tax increases, this proposal is another step backward in our efforts to create jobs and revive the economy.”
I will have all the details on the financial regulation reform bill in my “Week in Review” column, 7/3.