Obama Tells Wall Street to Stop Fighting Reform
AP
Updated 1:07 p.m.
President Obama traveled to New York City Thursday, where he pointedly told members of the city's financial industry to stop fighting reasonable industry reform.
"We will not always see eye to eye," Mr. Obama said to members of the banking industry in his speech at New York's Cooper Union, not far from Wall Street. "We will not always agree. But that does not mean we have to choose between two extremes."
"We do not have to choose between markets that are unfettered by even modest protections against crisis, or markets that are stymied by onerous rules that suppress enterprise and innovation," he continued. "That's a false choice."
The president urged industry executives to join those seeking to pass reform "not only because it is in the interests of your industry, but because it is in the interests of our country."
The president said industry lobbyists have been engaged in a "furious effort" to weaken or kill the pending legislation, which has passed the House and is being debated in the Senate. He said to industry leaders present for the address - including executives from Goldman Sachs, Morgan Stanley and Bank of America - that "I want to urge you to join us, instead of fighting us in this effort."
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The president stressed that he did not want to kill Wall Street, a vital part of the New York City economy.
"I believe in the power of the free market," he said. "I believe in a strong financial sector that helps people to raise capital and get loans and invest their savings. It's part of what has made American what it is."
But he also lamented that some on Wall Street "forgot that behind every dollar traded or leveraged, there is family looking to buy a house, and pay for an education, open a business, save for retirement."
"A free market, he said, "was never meant to be a free license to take whatever you can get, however you can get it."
CBS
The speech to about 700 guests comes as a bipartisan agreement on financial reform in the Senate appears imminent. The White House said before the speech that it was not aimed exclusively at industry executives, though the setting - and Mr. Obama's multiple comments aimed directly at precisely that group - sent a clear message.
"It is essential that we learn the lessons of this crisis, so we don't doom ourselves to repeat it," said Mr. Obama. Without reform, he said, "our house will continue to sit on shifting sands, and our families, businesses and the global economy will be vulnerable to future crises. "
The president outlined the four planks of the planned industry reform in his remarks. The first, he said, entailed the creation of a way to protect the financial system and the broader economy if a large firm begins to fail. He noted that such a system exists for smaller banks (via the FDIC) but not for large, interconnected firms like Lehman Brothers.
"We need a system to shut these firms down with the least amount of collateral damage to innocent people and businesses," he said. "From the start, I've insisted that the financial industry - and not taxpayers - shoulder the costs in the event that a large financial company should falter. The goal is to make certain that taxpayers are never again on the hook because a firm is deemed 'too big to fail.'"
The president targeted Republicans, among them Senate GOP leader Mitch McConnell, who have suggested the legislation is actually going to encourage future taxpayer bailouts of Wall Street.
"That may make for a good sound bite, but it's not factually accurate. It is not true," he said, to applause. He said the system as it stands is what led to bailouts.
"A vote for reform is a vote to put a stop to taxpayer-funded bailouts," he said. "That's the truth. End of story. And nobody should be fooled in this debate." He later asked those involved in the debate to "put this kind of cynical politics aside."
Mr. Obama also pointed to the so-called "Volker Rule," which, he said, "places some limits on the size of banks and the kinds of risks that banking institutions can take." Those limits, he said, will instill confidence in the financial system both at home and abroad.
The second plank identified by the president was a push for new transparency in financial markets. He said that companies like AIG had been making "huge and risky bets" with derivatives and other instruments that in many ways "defied accountability, or even common sense."
AP
"In fact, many practices were so opaque, so confusing, so complex that the people within these firms didn't understand them," he said. And while "there is a legitimate role for these financial instruments in our economy," he said -- the president pointed to examples of presidents using these sorts of instruments in a positive way -- there must be a way to "prevent reckless risk taking."
"The only people who ought to fear the kind of oversight and transparency that we're proposing are those whose conduct will fail this scrutiny," he said.
The third plank involved the establishment of consumer financial protections. "While it's true that many Americans took on financial obligations that they knew - or should have known - they could not have afforded, millions of others were, frankly, duped," he said. "They were misled by deceptive terms and conditions, buried deep in the fine print." Congress has been debating the structure and scope of a new Consumer Financial Protection Agency designed to protect consumers.
And the final plank was a plan to give company shareholders power over executive pay and corporate elections. While Americans don't begrudge success, the president said, enormous bonuses for bailed out companies are the sort of thing that "offends our fundamental values."
The president closed by saying that there had been a deployment of cash, lobbyists and rhetoric to influence the legislation, sometimes through "misleading arguments and attacks" meant to effectively destroy it.
He read an excerpt from Time Magazine reporting that bankers were worried that new legislation would destroy the banking industry -- before noting that it came from 1933, and concerned the now widely-lauded FDIC. (The story is here.)
In the end, the president said, "there is no dividing line between Main Street and Wall Street. We rise or we fall together as one nation."
Senate Democrats are currently planning to hold the first vote on the reform bill on Monday evening. That vote would be on a motion to begin debate, and would require the support of at least one Republican to break a potential filibuster. If and when the Senate passes the bill it will need to be reconciled with the House version before going to the president.
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FOR MAJOR PRINCIPALS, DEALERS, TRADERS IN BOTH COMMODITY AND STOCK MARKETS
In the name of providing more liquidity, increased efficiency of our markets, and other logically and beneficially-sounding reasons for justification of such U.S. FEDERAL GOVT LICENSED practices, our financial exchanges have been granted such licenses for MANY DECADES - perhaps for one hundred years or more.
Prices of the underlying security or commodity are regularly and frequently manipulated, specifically for 'accommodation' of the specie - either to increase or to reduce its price - which is held by the dealers, traders and/or principals, according to their positions (long or short, or both).
The following has been copied from an item written against 'short selling' and against selling what is not owned, or what does not even exist:
[ The CFTC is the Commodity Futures Trading Commission, and their job is to regulate futures contracts, to prevent fraud. But they protect and encourage fraud! How? They place position limits on the longs (and there should never be limits on what you can buy in a free market), but they refuse to place and enforce position limits on the shorts (who fraudulently sell what they do not have). If anything, to prevent fraud, they should limit the shorts, and not limit the longs.
Also, it is well known that JP Morgan is a major precious metals short, but the CFTC does nothing.
http://www.caseyresearch.com/displayGsd.php?id=106 ] END
FINAL, BOTTOM LINE QUESTION:
What happens when the holders/owners of the contracts, options, derivatives, and/or other complex paper 'representational certificates', demand delivery of what they purportedly own?
They will find out that only perhaps one percent of the underlying specie or commodity actually exists, and that the vast majority have been sold fraudulent pieces of paper!
Your arrogance and hate for Obama gave you away. You are obviously a republican and at the very far right too. It's laughable that you claim to be an independent. If you are ashamed that you voted for bush, then good for you. Just don't make a mistake of voting for a female bush(palin).
Maybe not.
To opposed every reform, from credit card reform to nuclear reduction is a bit suspicious. Don't you think that it would be better for the GOP to think first before opposing something. They care more about political posturing than what is good for america.
Obama has repeatedly tried to reach to the other side, but republicans just demonize his efforts and attack his character. The GOP has sunk really low. Terrorist, Socialist, Facist... GOP debate is dishonest and uncivilized.
http://www.youtube.com/watch?v=z3xE69w6ar4
It prevents credit card companies from gouging people. seems to be a good common sense reform.
<cut/paste>
Summary of credit card reform bill
1.Prevents rate increases due to universal defaults
2.Prevents all interest rate increases during the first year
3.Restricts interest rate increases on existing balances
4.Disallow the double billing cycle
5.Ample notice for rate increase on future purchases
6.Requires payments be applied to the higher interest rate balance first
7.Provides sensible due dates and time to pay
8.Requires clear enhanced disclosures
9.Places limits on fees and penalty interest
http://www.factcheck.org/elections-2008/who_caused_the_economic_crisis.html
You may say that it's unclear who really is responsible. But what is clear is everytime we have a republican president, our economy tanks and our nation debt doubles.
http://cleantechcompass.files.wordpress.com/2010/01/natl_debt_chart.jpg
They chose to side with the banks rather than the american people.
The Republicans fought the Healthcare reform.
Again republicans sided with the insurance companies.
Now they are fighting financial reform. So what is new. they are the party of NO. Obviously the party who is not on the publics side.
Heck they even criticized the nuclear arms reduction treaty.
Washington (both political parties) has run Social Security and Medicare into the ground. For decades, (not just during this administration and Congress) Congress has stolen funds from Social Security, spent them, and never replaced them. The federal government is an exceptionally corrupt and poor manager of programs, and we have allowed them to be so by our ignorance and apathy.
Now Washington wants to run health care and Wall Street, and I am not a big believer in Washington's track record. Why should we want to give more responsibility to a group which has shown itself to be irresponsible? The worst example of irresponsibility carried out by leaders of both parties (for decades) in the federal government is to spend close to $14 trillion more than the country has. In recent times, the only real exception was when we had a Democrat President Clinton and a Republican led Congress and Senate.
The bottom line is that track records mean something, and the federal government has a very poor one in managing financial affairs. No, I do not want to see the federal government running more of the country. It would be a disaster.
With the enormous national debt, it is obvious to even the dumbest person that we can not afford the federal programs that we currently have. Yet the Democrat party this year decided (against the will of the majority of Americans) to add another massive federal program (health care). This is absolute irresponsibility. For this reason, the revolt will mainly hit the Democrats. We must find candidates who will behave like responsible adults, and reduce the federal government to a manageable size. This bunch has maxed out the credit card, and we are in trouble
Shouldn't you misinformed conservatives be at your fox fake news network.
Since your so smart and can't figure it out, I break it down for your grade school education. Not everyone that doesn't agree with your point of view is a teabagger.