from Tales from the Trail:
Think brussels sprouts and cauliflower are agricultural commodities? Think again.
While the financial bailouts tossed to automakers, banks and other groups during the recent economic crisis left a funny taste in the mouth of some Americans, one former U.S. regulator hopes efforts to prevent another panic doesn't go rotten.
The U.S. Commodity Futures Trading Commission is immersed in drafting dozens of rules to assist it in increasing oversight of the once opaque over-the-counter derivatives market, widely blamed for exacerbating the recent financial crisis.
Among the rules it must craft is what the definition of an agricultural commodity is? Of course, corn, cotton, soybeans and livestock, among other items, fall into this realm.
But what about those "other foods" such as brussels sprouts, artichokes, cauliflower, or anything with curry? A former CFTC chairman says they are "abhorrent to American sensibilities" and should be banned.
"Like every U.S. citizen, there are certain agricultural commodities that are abhorrent to me," said Philip McBride Johnson, who is now with the law firm Skadden, Arps, Slate, Meagher & Flom.
In a comment letter to his former agency, he said there is a "natural link" between defining an agricultural commodity and a provision in a law that requires the regulator to protect the public by forbidding the listing of certain products that "are abhorrent to American sensibilities."
Clearly banned under this act are financial products based on wars, terrorism, and assassinations. If Johnson has his way, regulators will be able to protect consumers from a dozen foods that don't mesh with his palate.
PREVIEW-Final act begins in U.S. Congress on Wall St reform
By Kevin Drawbaugh
WASHINGTON, June 7 (Reuters) – Negotiators from the U.S. Senate and House will begin meeting this week to craft a final Wall Street reform bill, with banks facing changes that threaten their profits, if not their business models.
Some congressional Democrats want to fashion a bill that forces a basic banking industry restructuring, but leaders will have to balance that agenda against the need to forge compromise legislation that retains some Republican support.
Analysts are expecting that fundamental restructuring will be avoided, “This bill is more about profitability and less about viability. That means the legislation will hurt the banking sector, but it will not sink it,” said Jaret Seiberg, a policy analyst at investment firm Concept Capital.
The delicate task of crafting a winning compromise will fall to Representative Barney Frank, who will chair the “conference committee” getting under way in a few days, and Senator Christopher Dodd, a consensus builder who will lead the Senate negotiating team.
Both lawmakers are old-school liberal Democrats with more than 60 years on Capitol Hill between them. They will need all of that experience to finish up a legislative project that is at the top of President Barack Obama’s priority list.
Disputes loom over banks’ lucrative dealings in derivative contracts, such as credit default swaps; the amount of capital they must set aside for hard times; and the trading they do on their own books unrelated to customers’ needs.
INTERVIEW-Rep Frank: Fed as consumer watchdog home a “joke”
WASHINGTON, March 2 (Reuters) – Representative Barney Frank, chief architect of financial reform in the U.S. Congress, told Reuters on Tuesday he “thought it was a joke” when he learned key senators were discussing putting a new financial consumer watchdog inside the Federal Reserve.
“I thought it was a joke at first, to be honest, with all this denunciation of the Fed,” Frank said in an interview.
“If that’s the price of a Republican deal, then it’s not a good deal and the House wouldn’t accept it,” he said.
President Barack Obama’s plan to set up an independent Consumer Financial Protection Agency (CFPA) to regulate mortgages and credit cards has been the main obstacle for weeks to a bipartisan Senate compromise on financial reform.
Senate Banking Committee Christopher Dodd, a Democrat, is discussing putting the watchdog inside the Fed as a possible compromise with Republicans, who oppose an independent agency. (Reporting by Kevin Drawbaugh; Editing by Dan Grebler) ((kevin.drawbaugh@thomsonreuters.com, +1 202 898 8390, +1 202 488 3459 (fax))) h
US Rep Frank sees ending Fannie Mae, Freddie Mac in current form
WASHINGTON, Jan 22 (Reuters) – Mortgage giants Fannie Mae and Freddie Mac are likely to be abolished in their current form, a key lawmaker in the U.S. House of Representatives said on Friday.
“I believe this committee will be recommending abolishing Fannie Mae and Freddie Mac in its current form and coming up with a whole new system of housing finance. That is the approach rather than the piecemeal one,” said Representative Barney Frank, chairman of the powerful House Financial Services Committee and a Massachusetts Democrat.
Frank made the comments at hearing on executive compensation. He later told reporters he will hold hearings on the housing finance market and then move to a restructuring of Fannie Mae and Freddie Mac. He said he would look at Federal home loan banks and the structure of the Federal Housing Administration and Ginnie Mae.
Treasury Secretary Timothy Geithner on Thursday said the Obama administration is committed to “reforms” of the GSEs, but said it would likely not be until 2011 until substantive changes are made.
“I don’t think we’re going to be able to legislate that until that process can start, until next year, because it’s just a complicated thing to get right,” Geithner said in an interview with PBS Television.
“But we are completely supportive and agree completely with the need to make sure that we take a cold, hard look at what the future of those institutions should be in our country,” Geithner said.
(Reporting by Rachelle Younglai and Corbett B. Daly; Editing by Andrew Hay) ((corbett.daly@thomsonreuters.com; +1-202-310-5487)) ((Multimedia versions of Reuters Top News are now available for: * 3000 Xtra: visit http://topnews.session.rservices.com
U.S. House OKs Fed audit provision, eyes on Senate
By Mark Felsenthal
WASHINGTON, Dec 11 (Reuters) – The U.S. Federal Reserve on Friday lost the opening round in a battle to defeat a congressional plan to subject its interest rate decisions to audits, and will now look for a comeback victory when the Senate starts to move on regulatory reforms.
The House of Representatives delivered the loss with a 223-202 vote in favor of a revamp of financial regulation that, among other things, would pare Fed supervision over financial firms and its capacity to provide emergency help to banks, while allowing audits of monetary policy by a watchdog agency.
Fed Chairman Ben Bernanke and other top officials for weeks had argued the audit provision would result in a costly impression that the central bank’s rate decisions could be swayed by politics. They warned this could lead financial markets to fear inflationary policies, which in turn could drive up borrowing costs and undermine the economy.
The Fed will have ample opportunity to get allies on Capitol Hill to defeat the audit measure.
Senate Banking Committee Chairman Christopher Dodd has proposed a bill that would also open the Fed’s emergency lending to audits, but not its interest rate decisions.
The proposed overhaul is a backlash against a laissez-faire regulatory climate that is widely blamed for laying the ground for the financial crisis that plunged the U.S. and global economies into a deep recession that is only slowly easing.
Financial reforms win procedural vote in US House
By Kevin Drawbaugh
WASHINGTON, Dec 9 (Reuters) – The U.S. House of Representatives approved a procedural rule on Wednesday that cleared the way for floor debate to begin on legislation that would give the government broad new powers over large financial firms and tighten bank and capital market regulation.
In a 235-177 vote, Democrats pushed through the rule, with only a handful from their own ranks voting in opposition, after settling differences among themselves over more than 200 proposed amendments. All Republicans voting opposed the rule.
President Barack Obama and congressional Democrats see financial regulation reform as crucial to preventing a repeat of last year’s financial crisis and the taxpayer bailouts that followed of companies such as AIG and Citigroup.
On Thursday, lawmakers are expected to propose a flood of amendments to the 1,279-page bill, hammered out over months of discussion and compromise at the committee level.
House leaders hope to bring the measure to a final vote by Friday, before the holiday break. Approval in the House, which analysts widely expect, would throw the financial reform agenda into the Senate where debate will likely go well into 2010.
The bill would set up an inter-agency council to police systemic risk in the economy, while creating new protocols for the government to deal with large, troubled financial firms.
US lawmakers urged to drop clearinghouse ownership cap
By Jonathan Spicer NEW YORK, Nov 20 (Reuters) – NYSE Euronext, LCH.Clearnet, BATS Global Markets and other firms partnered with banks have urged two U.S. legislators to drop a proposed “rigid” cap on dealer ownership of clearinghouses, according to a letter sent this week.
U.S. House Democrats sharpening ‘too big to fail’ plan
By Kevin Drawbaugh WASHINGTON, Nov 17 (Reuters) – A key U.S. congressional panel moved toward toughening a plan for dealing with “too big to fail” financial firms on Tuesday, while rejecting a Republican alternative backed by Wall Street.
The US government should not approve any merger that would result in a “too big to fail” entity.
Banks sense danger, warn U.S. Congress on breakup power
By Kevin Drawbaugh WASHINGTON, Nov 16 (Reuters) – Some of the world’s largest financial firms on Monday urged a top U.S. lawmaker not to pursue big bank break-up legislation, an idea attracting interest in Congress and causing alarm on Wall Street.
US Rep. Frank seeks changes in derivatives bill
WASHINGTON, Nov 4 (Reuters) – The chairman of the U.S. House Financial Services Committee is seeking changes to draft legislation for the $450 trillion privately-traded derivatives markets, with the intent of making it harder for banks to avoid trading the contracts on exchanges.
-
Author Profile
-
