Elders of Wall St. Favor More Regulation

[dtotire]

Elders of Wall St. Favor More Regulation


By LOUIS UCHITELLE
Published: February 16, 201




They certainly don’t think of themselves as angry Main Streeters. They grew quite wealthy in finance, typically making their fortunes in the ’70s and ’80s when banks and securities firms were considerably more regulated. And now, parting company with the current chieftains, they want more rules.

While the younger generation, very visibly led by Lloyd C. Blankfein, chief executive of Goldman Sachs, lobbies Congress against such regulation, their spiritual elders support the reform proposed by Paul A. Volcker and, surprisingly, even more restrictions. “I am a believer that the system has gone badly awry and needs massive reform,” said Mr. Bogle, the 80-year-old founder and for many years chief executive of the Vanguard Group, the huge mutual fund company.

Mr. Volcker, 82, signed up the support of nearly a dozen peers whose average age is north of 70 and whose pedigrees on Wall Street and in banking are impeccable. But while Mr. Volcker focuses on a rule that would henceforth prohibit a bank that takes deposits from also buying and selling securities for its own account — risking losses in the process — most of his prominent supporters see that as a starting point in a broader return to regulation. And most do not hesitate to speak up in interviews.
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That worries William H. Donaldson, a chairman of the Securities and Exchange Commission in the George W. Bush administration, and a co-founder of Donaldson, Lufkin & Jenrette, a prominent Wall Street firm in its day. To deal with such issues, Mr. Donaldson, now 78, would have Congress create a powerful regulatory body, independent of the Federal Reserve or any other government body, whose members would be appointed directly by the president.


“The Volcker Rule and Mr. Volcker’s initiative,” he said, “are really taking the discussion of regulation to a whole new level.”



http://www.nytimes.com/2010/02/17/business/17volcker.html



They should tell this to Sen. Shelby, who opposed the Volcker rule.