Hillary Clinton Takes On Wall Street — Or Does She?

[portlander23]

Hillary Clinton Takes On Wall Street — Or Does She?
Eugene Grygo
Financial Technologies Forum

“I like her view on linking bonuses to regulatory fines,” says Mary Kopczynski, CEO of the regulatory change management company, 8of9 Consulting, based in New York. “I think that should be the case not just for the executives, but everyone. What the banks need is a better culture of compliance and if there are direct financial incentives tied to that culture of compliance, then you will see a greater commitment from top to bottom,” she adds.

“Some of her other suggestions I shrug my shoulders at because banks are already exiting businesses because the capital charges are too high,” Kopczynski says. “So the talk about adding a ‘risk fee’ is unnecessary because there are so many existing risk fees like the Basel Accords.”

In contrast, Anshuman Jaswal, PhD, a senior analyst with Celent, a division of Oliver Wyman, gives Hillary’s plan a thumb’s up.

“The Clinton plan has many strong measures in place to make the financial system safer and more accountable,” Jaswal says. “There will always be some elements that might be argued against, but her overall approach to reforming the financial market place is pragmatic and sound.”

Kevin McPartland, principal, market structure and technology, Greenwich Associates, give the Clinton’s positions a mixed review. “It was written to reinforce the anti-Wall Street feeling on Main Street,” McPartland says. “And while some of the theories make sense, such aligning management incentives for reasonable risk taking, others are solutions in search of a problem, such as the tack on ‘high frequency traders.’ ”

Last, but certainly not least, Larry Doyle, an industry veteran who is also the muckraking author of “In Bed With Wall Street: How Bankers, Regulators and Politicians Conspire to Cripple Our Global Economy,” published last year by Palgrave Macmillan, offered some clear opinions about her plan.

“Hillary Clinton is a master politician,” Doyle says. “She is tacking left here with this plan so as to make sure that Bernie Sanders does not build further momentum with the liberal base of the Democratic Party. She makes some very salient points with her plan, but throughout her career she has never been one to seriously take on Wall Street. I do not expect that to change now especially given that Clinton’s largest contributors are the big banks themselves.”

Related:

Hillary Clinton, Jeb Bush Still Favorites of Wall Street Banks

Lobbyist: Hillary Clinton will become Mrs. Wall Street if she’s elected

Colbert: Clinton to Banks- Cut it out!

MATT TAIBBI: Hillary Clinton's Take on Banks Won't Hold Up

Robert Scheer: Go Ahead, Back Hillary Clinton and Forget All About Her Record

[upaloopa]

1. Why would anyone spend time making a

detailed plan to regulate Wall Street if it was never going to be put in place.
If you weren't really going to do something you wouldn't draw up a detailed plan, you just repeat jingles like "breaking up big banks."

[hifiguy]

2. Here's the take of a law professor

who is an expert in this field.

He is NOT impressed in the slightest.

Hillary Clinton’s Weak Plans for Changing Wall Street
She’s proposing tweaks when it needs an overhaul.

- snip -

the Clinton plan is small-scale. It’s Dodd-Frank 2.0: a list of regulatory tweaks requiring various agencies to write complicated new rules governing obscure corners of the financial markets. Here are a few examples:

margin and collateral requirements on repurchase agreements

public disclosure requirements for repurchase agreements

increased reporting requirements for hedge funds and private equity funds

more transparency for exchange-traded funds

greater disclosure requirements for large banks

increased attention to cyber-preparedness by regulators

permanent funding for the SEC and CFTC

This is technocratic incrementalism, the idea that the best way to approach a very big problem—a complex, interconnected financial system anchored by large banks that are so poorly managed they are not even aware of the risks they are taking on—is with better disclosure here and stronger incentives there. That was the philosophy of Dodd-Frank, which, with the exception of the Consumer Financial Protection Bureau, largely amounted to giving existing regulators a handful of complicated new tools (living wills, hedge fund registration, the Office of Financial Research, derivatives clearinghouse regulation, and so on). Now Clinton is offering more of the same.

* * *

Why do politicians persist in thinking they can change the way the world works by forcing regulators to write some more rules and then try to enforce them? What’s needed are structural changes that reduce the sources of risk directly—for example, by breaking up large banks or increasing capital requirements by a factor of three—not more regulatory discretion. Yes, those types of structural changes will be impossible to get through a Republican House, but so will every item on Clinton’s wish list. Change will take years, and it will take leaders who are willing to make the case over the long term.

http://www.theatlantic.com/business/archive/2015/10/hillary-clintons-wall-street-plan/409873/

[Babel_17]

3. We'll get to see Sanders and Clinton speak directly about their plans

The closer we get to people actually voting for the Democratic candidate for POTUS, the more focus there will be on the most important issues. For a large segment of the voters in the primaries, and the volunteers who work for the candidates, regulating the industries that contributed to the collapse of our economy is an extremely important issue.

And of course the media will paying attention, as well as these industries. The unexpected success of the Sanders campaign has brought this issue to the fore. This is a good thing.