0
Lawmakers Gird for Battle Over Wall Street Reforms
Dems, GOP split over regulation
By Jim O'Neill
|
Posted Mar 23, 08 8:04 AM CDT
|
Share
(Newser)
–
Lawmakers are debating how to regulate and oversee financial institutions to prevent another Bear Stearns near-catastrophe. But exactly what that solution should look like depends on who's doing the proposing. President Bush and Wall Street say that Washington's heavy hand could hamstring the industry’s ability to innovate, reports the New York Times. Democratic lawmakers contend it’s time to tighten controls to prevent future meltdowns.
A key issue is liquidity. Democrats want investment banks and lenders to have more cash on hand. Republicans argue that keeping capital reserves high tightens credit markets. Both sides want tighter oversight and agree that current regulatory agencies—a veritable alphabet soup of sometimes competing bodies—may be overwhelmed and ill conceived.