Financial Regulatory Forum

EU states cool to Obama proprietary trading ban for big banks -document

BRUSSELS, Feb 15 (Reuters) – If U.S. President Barack Obama’s plan to ban proprietary trading at some banks was applied in the European Union, it could be problematic for the bloc’s universal banks, an EU document obtained by Reuters said.

EU finance ministers, following a call from the Netherlands which backs the proposal, will discuss its possible impact on Europe at a meeting on Tuesday but no consensus is expected.

The plan, dubbed the “Volcker rule,” was drafted by White House adviser and former Federal Reserve Chairman Paul Volcker, stunned global markets last month and is already facing resistance in Congress.

EU countries were not consulted and complained that a global approach to rulemaking being spearheaded by the Group of 20 rich and emerging economies was at risk.

Britain, France and Germany have said the approach should not be copied in Europe where many banks combine proprietary trading and commercial banking under one roof.

Obama bid to rein in banks meets Senate resistance

By Kevin Drawbaugh

WASHINGTON, Feb 4 (Reuters) – The U.S. Senate on Thursday looked increasingly likely to adopt, at best, only a watered-down version of the Obama administration’s ambitious proposal to limit risky trading by banks.

After two hearings in three days on the issue, Senate Banking Committee Chairman Christopher Dodd told reporters it will be difficult to legislate a curb on bank trading practices as specific as the White House proposed last month.

He said it would be easier to include something less ambitious in a sweeping package of financial regulation reforms, under development for more than a year now, which aides said was fast nearing completion.

FACTBOX-Political roadblocks to Obama’s budget

Feb 2 (Reuters) – U.S. President Barack Obama faces major hurdles to get his $3.8 trillion budget plan through Congress. Obstacles include members of his own — at times fractious — Democratic Party.

Obama proposed and Congress ignored many of the same policies last year, though expiration of individual tax cuts enacted by former President George W. Bush at the end of this year virtually ensures individual tax issues will be addressed.

Below is a summary of roadblocks facing some of Obama’s key proposals.


Fulfilling a campaign pledge, Obama proposed extending the Bush tax cuts for individuals earning less than $200,000 and couples making less than $250,000. For those making more than that, Obama proposed letting the cuts expire. That would bring the top two income tax brackets back to 39.6 and 36 percent, from 35 and 33 percent respectively.

BREAKINGVIEWS – Obama’s 2011 budget underlines depth of US woes

– The author is a Reuters Breakingviews columnist. The opinions expressed are his own –

By Martin Hutchinson

WASHINGTON, Feb. 1 (Reuters Breakingviews) – President Obama’s 2011 budget underlines the depth of U.S. fiscal woes. By then, bailouts and stimulus outgoings will be all but over, recovery should be under way, and Obama’s promised spending freezes should be in place. Yet the deficit next year will still be an eye-watering $1.3 trillion. Bigger spending cuts are needed — and soon.

Monday’s budget for the year ending in September 2011 includes higher federal spending than the Congressional Budget Office estimated as recently as Jan. 26, despite Obama’s freezes. With lower revenue as well — thanks largely to the CBO’s overly optimistic assumptions about tax revenue — the deficit is projected to be $287 billion bigger than the CBO expected.

Obama budget omits cap-and-trade revenues – official

By Jeff Mason

WASHINGTON, Feb 1 (Reuters) – The White House has dropped projected revenues from a “cap-and-trade” mechanism to fight climate change from its new budget, an administration official said, bowing to the possibility that the U.S. Congress may not pass it.

Last year the Obama administration forecast revenues of $646 billion in the years 2012-2019 from an emissions trading program that formed the crux of its proposal to fight global warming.

The legislation that contains that proposal is now stalled in the U.S. Senate and cap-and-trade, which sets limits on greenhouse gas emissions and allows companies to trade permits to pollute, may be cut from a final bill if one is passed.

Obama tones down international corporate tax aims

WASHINGTON, Feb 1 (Reuters) – President Barack Obama appeared to scale back his ambitious plan to close loopholes global companies use when accounting for taxes on profit earned overseas in his 2011 budget blueprint released on Monday.

Obama, who has used heated rhetoric to blast corporations that keep profits overseas to avoid U.S. tax, proposed changes that he said would raise $122 billion over a decade.

He mentioned the issue in his State of the Union address last week, saying: “To encourage these (energy and manufacturing companies) and other businesses to stay within our borders, it’s time to finally slash the tax breaks for companies that ship our jobs overseas and give those tax breaks to companies that create jobs in the United States of America.”

Obama unveils $33 billion tax credit to boost jobs

By Steve Holland

BALTIMORE, Jan 29 (Reuters) – President Barack Obama on Friday proposed $33 billion in tax credits to coax small businesses into hiring workers as he underscored his commitment to pushing job creation to the top of his agenda.

With public frustration over double-digit unemployment eroding his popularity, Obama has begun rolling out initiatives aimed at backing up his jobs pledge made in his economy-focused State of the Union Address earlier this week.

The latest proposal calls for a $5,000 tax credit for every net new worker hired in 2010. The amount would be capped at $500,000 per firm to make sure that the bulk of the benefits go to small businesses.

FACTBOX-Obama plans $33 billion job and wage tax credit

WASHINGTON, Jan 28 (Reuters) – U.S. President Barack Obama plans a $33 billion tax credit to encourage small businesses to hire workers and boost wages. Details of the plan, which will be laid out on Friday when the president visits a small business in Baltimore en route to speak to Republican lawmakers holding a retreat there, include:

* Businesses will receive a $5,000 tax credit for every net new employee they employ in 2010. The total amount of the credit for any one firm will be capped at $500,000, to ensure the majority of the benefit is targeted at small businesses. Start-ups will be eligible for half of the tax credit.

* Businesses that increase wages or hours for their existing employees will be reimbursed for the Social Security payroll taxes they pay on real increases in their payrolls. This bonus would be based on Social Security payrolls, so it would not apply to wage increases above the current taxable maximum of $106,800.

Obama pushes jobs, vows to fight on after tough year

By Caren Bohan and Ross Colvin

WASHINGTON, Jan 28 (Reuters) – U.S. President Barack Obama pushed job creation to the top of his agenda and vowed not to abandon his struggling healthcare overhaul after a political setback that raised doubts about his leadership.

With the economy still weak and unemployment at a painful 10 percent, “Jobs must be our number one focus in 2010,” Obama told Congress in his annual State of the Union address on Wednesday.

Obama, who inherited a financial crisis and wars in Iraq and Afghanistan from the Bush administration, admitted he had made mistakes and that his first year in office had been a difficult one.

Dutch to support U.S. bank plan, seek EU support

    AMSTERDAM, Jan 26 (Reuters) – Dutch Finance Minister Wouter Bos has backed the plan from U.S. President Barack Obama to limit the scope and size of banks and reduce their risk taking and will push to win support of the plan among EU leaders. (more…)