Jul 15 2010
Wall Street reform is on the way
The Senate surpassed the filibuster-threatening “Party of No” this morning in an effort to pass sweeping financial regulations. The final vote is set to take place this afternoon. [Update: Passed 60-39]
Three Republicans — Scott Brown of Massachusetts and Olympia Snowe and Susan Collins of Maine — helped Democrats reach the critical 60-vote threshold. The House passed the bill before the July 4 recess.
Heather Booth, Director, Americans for Financial Reform (AFR):
“Passage of this legislation is a victory for Main Street over Wall Street. Nearly two years after Wall Street and the Big Banks took our economy to edge of the abyss, and cost 8 million Americans their jobs, Congress has passed and sent to the President the most sweeping banking reforms since the Great Depression.”
What does this mean for us? The following is excerpted from the AFR website.
What Wall Street Reform Will Do
Landmark consumer protection: Consumers will now have an independent advocate on their side to prevent tricks and traps related to mortgages, payday loans and checking accounts. Credit cards and mortgages will offer terms in language we can all understand. Read more about the Consumer Financial Protection Bureau.
Shining Light on Shadow Markets: The $600 trillion derivatives market will now operate in the open, so regulators can catch problems – like the credit default swaps that brought down the economy – before they happen. Read more about Derivatives Trading.
Preventing taxpayer bailouts: The government will have the authority to step in and safely shut down any failing financial firm, not just banks, instead of propping them up with taxpayer money. Read more about Systemic Risk Regulation.
Reining in the Wall Street Casino: Banks will be barred from gambling for their own account with your money. Banks will have to separate some of their derivatives trading operations into affiliates.
Mortgage reforms: For the first time lenders are prohibited from making loans that borrowers cannot repay, and banned from receiving kickbacks for steering people into high rate loans when they qualify for lower rates. Consumers are protected from abusive loan fees and penalties for prepaying.
Strong investor protections: Shareholders will have new tools to hold corporate boards and management accountable, including a voice on executive compensation decisions and an enhanced ability to nominate and elect corporate directors. Brokers will have to act in the best interests of their customers.
Holding Credit Rating Agencies Accountable: Credit rating agencies will no longer have a vested financial interest in giving high ratings to risky investments. Better controls will hold rating agencies accountable for the reliability of their reporting. Read more about Credit Rating Agencies.
Opens the Fed’s books: The Fed’s emergency lending programs from the financial crisis will be audited to see where the money went. The Fed will also have to disclose loans it makes to banks through its discount window.
Credit cards and mortgages will offer terms in language we can all understand?! That sounds pretty awesome to me, as does just about everything else this bill could do. Cheers to the Representatives, Senators and all advocates that are pushing for this reform.
Americans for Financial Reform is a coalition of more than 250 national and state organizations, including USAction. Heather Booth, their Director, is the Vice President of our Board of Directors.
Thank goodness for this bill! Now, instead of learning what the fine print means, or what the terms of certain exotic mortgage programs are in order to educate ourselves, we can just rely on a new agency to do that for us. We all know that government agencies do everything correctly all of the time, and they are always looking out for the interests of “Main Street.”
Look, I can in no way disagree that it’s awful that there were institutions so big and so intertwined in the functioning of our financial system that we as taxpayers had to make billions of dollars in loans. It’s terrible and it’s inexcusible. However, it’s also inexcusable that we as a nation don’t take the time to educate ourselves better on the innerworkings of these institutions, and the products that they sell. My fear is that all we’ve really done is create another agency that will be just as capable of bungling things as has happened already.
This new bill sounds good, however, it does not let us, as American citizens off the hook from paying attention to what is going on around us. Wall street will continue to do what it can to continue to have what it wants. We must pay attention and take action when necessary still. And as Paul has stated, whenever we enter into an agreement for a new loan or bank account, we must be responsible for ourselves and read everything provided to us. We can’t expect our government to take care of our financial welfare. We are Americans, aren’t we? Thanks to True Majority for making this information easy to access and understand!
This is definitely a step in the right direction but we must stay informed and on top of things. I am very happy to hear that “the people” can make a difference! Thanks to True Majority for getting this information out to many. It gives me hope that if we all work together we can turn the corruption around and make this our country that is how our forefathers intended it - FOR THE PEOPLE!
Paul,
Are you arguing for less regulation, though? Disasters like Goldman-Sachs, the mining accident in West Virginia and the BP oil spill all thrive when regulation ceases.
I definitely agree that we need to become better financial consumers and should read the fine print, but I’d like it if there was less fine print.
Jennie & Karen,
Thanks for the encouragement!
Hate to be a buzz kill however… I am already reading that this passed after Scott Brown bartered to include some obvious loopholes for these corporations to walk through and taxpayer funding instead of penalties funding the program. Should we start pushing now for an amendment?
I BET A MILLION $$$$ that NONE of you and especially the writer or the article even READ ONE PAGE OF THE BILL!!!!
You got your info from tha tliberal media that lies!!!
Try READING THE BILL FIRST !!
If you read it, you would know that the Bill gave the PRIVATE Federal Reserve bank EVEN MORE CONTROL AND POWER than they already had!!!
The PRIVATE FEDERAL RESERVE now totally controls the entire economy!! Credit, Banking, Loans, Investments, insurance, YOU NAME IT!! They control it all!!!
That is NOT GOOD!!! WAKE UP!!!
You dont read one page of a bill, you dont even know what the Federal Reserve is or does and you write opinions like you are an expert even though you didnt read it!!
How about you read it FIRST and then write how great it is if you still feel that way.
Or did Rachael Maddow read off a teleprompter and tell you what to think.
If you read it and still think its good for anyone, please let me know why.
But its good to know you think something is great that you didnt read.
Did you tell other people Avatar was a great movie before you even saw it?? After all, people on TV said Avatar was good. So why not tell everyone how great Avatar is before you see it? Because its retarded.
But a movie isnt as important as world changing financial regulation so why even read it. The liberal TV always will tell the truth afterall.
Let me know when I can pick up my million $$ for my bet because you didnt read shit!! But that didnt stop you from writing CRAP
Goldman Sachs WROTE THE BILL!!
When Corporations write bills and not even politicians, the people get FCUKED!!
What is so hard to understand??
Then they hand it off to the puppet who they funded to get elected and it gets passed while the dumb public waits for Brett Fafrve or Labron James to make a decision.
The bill is a Federal Reserve takeover of the entire economy. If you know what the Federal Reserve is than you would know not to support such a thing.
Its over your head I know.
since you didnt hear it on TV