I/III. http://www.todayonline.com/World/EDC100716-0000194/US-Congress-finally-passes-financial-regulation-Bill
US Congress finally passes financial regulation Bill by THE NEW YORK TIMES 11:55 AM Jul 16, 2010 Afternoon latest WASHINGTON - The United States Congress yesterday gave final approval to an overhaul of the nation's financial regulatory system, intended to address the causes of the 2008 economic crisis and rewrite the rules for a more complex - and mistrustful - era on Wall Street. The vote by the Senate was 60 to 39, with three Republicans from the North-east joining with the Democrats in voting to advance the legislation. "We want to make sure this disaster never happens again," Senate majority leader Harry Reid of Nevada said of the vote. "The solution has to start here. "No more bailouts. No bank is too big to fail." When signed by President Barack Obama, the Bill will mark the end of more than a generation in which the prevailing posture of Washington toward the financial industry was largely one of hands-off admiration, evidenced by steady deregulation. While the measure does not fully restore the toughest restrictions imposed after the Great Depression, it is a clear turning point, highlighting a new distrust of Wall Street, fear of the increasing complexity of technology-driven markets, and renewed reliance on government to protect the little guy. The White House said it was already planning a ceremony next week to mark the completion of another landmark piece of legislation, following the enactment of the historic Healthcare Bill in March and last year's economic stimulus programme. Mr Obama's press secretary Robert Gibbs said that the regulatory overhaul was an achievement that Democrats would promote throughout the fall election season. "We cannot continue to operate using the same rules that got us into this recession," said Mr Gibbs. "I think this will be a vote Democrats will talk about through November." But there are no guarantees the Bill will be effective. One Democrat, Senator Russ Feingold, voted against it, saying it was still not strong enough to prevent future crises. Even Senator Christopher Dodd, chairman of the banking committee who was a main author of the Bill, acknowledged that Americans will probably not know for years - perhaps not until the next financial crisis strikes - if the response by Congress this year was sufficient, or falls short despite the best intentions. "We won't know the full results of what we have done until the very institutions we have created, the regulations we have suggested and provided for are actually tested," Mr Dodd said yesterday. "All we can do is create the structures and hope that good people will be appointed (who can) see to it that never again do we go through what we have gone through." The Bill, among other provisions, will create a council of high-level federal officials, led by the Treasury Secretary, to try to detect, and perhaps prevent, systemic dangers to the financial system, and it would give the government new authority to seize and shut down failing financial institutions. The Bill also seeks to curb the most risky behaviour on Wall Street, by restricting the ability of banks to invest and trade for their own accounts. II. http://www.marketwatch.com/story/us-stocks-lower-as-senate-passes-financial-overhaul-2010-07-15 JULY 15, 2010, 3:27 P.M. ET US Stocks Lower As Senate Passes Financial Overhaul Nesil Staney NEW YORK (MarketWatch) -- Financials fueled a decline in U.S. stocks Thursday as new signs of a cooling economy lowered hopes for a robust recovery, threatening to snap a seven-day winning streak. Investors retreated from the equities market after a mixed bag of economic data stoked concerns an economic recovery is proceeding more slowly than hoped. The passage of a major financial-overhaul bill by the U.S. Senate added to worries about the fragile banking sector. The Dow Jones Industrial Average fell about 88 points in the last hour of trading, though it was off session lows. All but five of the blue-chip index components fell. During the seven-day rally, the blue-chip index rose about 7%. Financial stocks, particularly susceptible to economic headwinds, retreated during the session despite a relatively upbeat earnings report from J.P. Morgan Chase. Investors were skeptical about future performance for banks, especially as they navigate their businesses under stiffer regulations. "The market is repricing for a slower growth environment," said Howard Ward, portfolio manager of Gamco Growth Fund. The Dow was recently down 88 points, or 0.86%, to 102777, after being down more than 100 points earlier in the session. The Nasdaq Composite slipped 0.5% to 2239, while the Standard & Poor's 500-share index shed 0.5% to 1090. Investors retreated from major market indexes after the Federal Reserve Bank of Philadelphia's business index dropped sharply, adding to unease over weak data reported earlier in the day. Producer prices fell for a third straight month in June, hurt by falling food and energy costs, although core prices remained tame. New York area manufacturing activity expanded at a slower-than-expected pace in July, according to a survey from the Federal Reserve Bank of New York. The data are "raising doubt as to whether the recovery in manufacturing has peaked," said John Toohey, vice president of equity investments at USAA Investment Management Co. "Since manufacturing was leading the economic recovery in the U.S., what does that mean going forward? Where is the strength in the economy going to come from?" However, in one economic bright spot, weekly jobless claims fell 29,000 to their lowest level since August 2008, though claims lasting more than one week jumped. J.P. Morgan reported a jump in profit and it reduced reserves for loans unlikely to be paid back. However, the bank continues to shed assets as loans, including bad ones, roll off its balance sheet faster than it can make new ones. Investors said the boost to earnings from the reduction in loan-loss provisions cast doubts over future growth. The euro surged, hitting a two-month high against the U.S. dollar. The euro was recently trading at $1.2898, up from $1.2738 late Wednesday in New York, boosted by the Spanish government's successful sale of $3.82 billion in 15-year bonds amid solid demand. However, a cautionary note came from China, whose rate of growth cooled slightly. The country's second-quarter gross domestic product grew by 10.3% over the same period a year earlier, slowing from the 11.9% annual growth recorded in the first quarter. The U.S. Dollar Index, which tracks the currency against a basket of six others, fell 1.1%. Demand for Treasurys increased, pushing yield on the 10-year note below 3%, down to 2.98%. Crude-oil prices slid below $76 a barrel, while gold futures advanced. Among stocks in focus, shares of BP climbed 2.9% after the oil giant took steps to begin testing a new system for collecting oil gushing from its blown-out Gulf of Mexico well. American International Group fell 0.9% after its chairman, Harvey Golub, resigned, citing tensions with the giant insurer's chief executive, Robert Benmosche. III. http://yglesias.thinkprogress.org/2010/07/the-underrated-finreg-bill/ Jul 15th, 2010 <http://yglesias.thinkprogress.org/2010/07/the-underrated-finreg-bill/>The Underrated FinReg Bill<http://yglesias.thinkprogress.org/2010/07/the-underrated-finreg-bill/> The Dodd/Frank financial regulation bill that passed the U.S. Senate today isn’t the greatest piece of legislation in human history, but with eighty percent of Americans saying they have little or no confidence in the bill<http://www.bloomberg.com/news/2010-07-13/wall-street-fix-from-congress-seen-ineffectual-by-four-out-of-five-in-u-s-.html> I think it’s fair to say that these measures have become substantially underrated. I also agree with Tim Fernholz<http://www.prospect.org/csnc/blogs/tapped_archive?month=07&year=2010&base_name=why_dont_people_trust_financia> that these numbers largely reflect the intersection between complicated issues and a general collapse in public trust. Almost nobody in the public has an informed, detailed opinion about this legislation but everyone’s sick and tired of trusting the powers that be. That said, I think media elites have also fallen down on the job a bit here. We’ve tended to focus much more on what’s *not* in the bill than on what is in the bill. What is in the bill is a consumer protection setup that would be considered a major progressive win as a standalone item. What is in the bill is a “resolution authority” that will let future regulators avoid the bailout-or-crisis dynamic that plagued us in 2008. What is in the bill are regulatory tools that even Simon Johnson likes<http://www.project-syndicate.org/commentary/johnson10/English>. The bill clarifies lines of regulatory authority and responsibility and should cut down on abusive “competitive regulation.” I don’t think the bill means we’ll never see an asset price bubble or a banking crisis again, but I also don’t think it’s possible to achieve that goal. It should, however, make crises less likely and make cleaning them up easier. My hope is that we won’t just leave things alone here. There *are* a lot of loose threads left hanging here regarding, on the one hand, America’s housing policy and on the other hand hand the role of Wall Street in American society. What’s more, this regulatory setup, like all regulatory setups, only works if the regulators want it to work and that only happens if politicians want the regulators to want it to work. So nothing is over. -- Peace Is Doable -- You received this message because you are subscribed to the Google Groups "Green Youth Movement" group. To post to this group, send an email to [email protected]. To unsubscribe from this group, send email to [email protected]. For more options, visit this group at http://groups.google.com/group/greenyouth?hl=en-GB.
