Thursday
Jan212010
Obama Proposes Key Banking Reforms
Thursday, January 21, 2010 at 2:34PM
By Laurel Brishel Prichard - University of New Mexico/Talk Radio News Service
President Obama warned financial institutions on Thursday that the rules regarding bank regulations will soon be changing.
The additional financial reforms that Obama proposed will stop banks from owning hedge funds and private equity funds that do not serve their customers. In addition, the President proposed putting limits on excessive growths and consolidations that prove to be risky. These steps would help strengthen the financial reform bills that are currently moving through Congress, said the President.
“Rarely does a day go by that I do not hear form folks who are hurting,” said Obama.
Obama referred to the proposal of restricting banks from making risky investments as the "Volcker Rule,” after former Federal Reserve Chairman Paul Volcker. This proposal would prevent banks from using their customers as a front in order to make money that would not directly serve the customers.
The second proposed reform would limit the amount of consolidation that financial institutions are able to enact. According to Obama, this would prevent taxpayers from having to again bail out banks that are “too big to fail."
Many of the firms that have been fighting reform have also been awarding massive bonuses and returning to old practices that initially put them in jeopardy, said the President.
“If these folks want a fight, it’s a fight that I’m ready to have," warned Obama.
President Obama warned financial institutions on Thursday that the rules regarding bank regulations will soon be changing.
The additional financial reforms that Obama proposed will stop banks from owning hedge funds and private equity funds that do not serve their customers. In addition, the President proposed putting limits on excessive growths and consolidations that prove to be risky. These steps would help strengthen the financial reform bills that are currently moving through Congress, said the President.
“Rarely does a day go by that I do not hear form folks who are hurting,” said Obama.
Obama referred to the proposal of restricting banks from making risky investments as the "Volcker Rule,” after former Federal Reserve Chairman Paul Volcker. This proposal would prevent banks from using their customers as a front in order to make money that would not directly serve the customers.
The second proposed reform would limit the amount of consolidation that financial institutions are able to enact. According to Obama, this would prevent taxpayers from having to again bail out banks that are “too big to fail."
Many of the firms that have been fighting reform have also been awarding massive bonuses and returning to old practices that initially put them in jeopardy, said the President.
“If these folks want a fight, it’s a fight that I’m ready to have," warned Obama.
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