Obama to Propose Knocking Banks Down to Size

Retiring Dodd wants GOP support, Obama be damned

(NEWSER) - President Obama’s plan to limit the amount of risk big US banks can take could well die in the Senate if the measure isn’t seen as bipartisan enough by Chris Dodd, the retiring Banking Committee chair, and Senate Republicans. “He wants to end his career with an important regulatory reform bill and he wants to make the bill bipartisan,” a staffer tells dealReporter of Dodd. “He is not going to risk bipartisan support to make the White House happy.” More»

Former Fed chair wants mechanisms to let 'em fail

(NEWSER) - It's more than a year after Americans learned the definition of "too big to fail," and it's time to push through the reform that will save having to re-learn that painful lesson, writes Paul Volcker in the New York Times . "As things stand," writes the chair of the president’s Economic Recovery Advisory Board, big banks now know that the taxpayers will bail them out, resulting in enhanced "incentives to risk-taking and leverage, with the implication of an even more fragile financial system." More»

Firms bundled bad debt then sold it short

(NEWSER) - Congress and financial regulators are probing several Wall Street firms for bundling bad debt, selling it to clients, and then profiting from betting that those same securities would fail, insiders say. Clients at Goldman Sachs and other firms lost billions of dollars on the mortgage-related securities as the housing market collapsed. The firms and some hedge funds made billions from the negative bets. More»

Still, president reminds finance industry, 'we're in this together'

(NEWSER) - At a fundraising dinner tonight in New York attended by (among others) the sorts of financial types who could afford the $30,400-per-couple entry fee, President Obama wagged a finger at Wall Street. “I would ask that you join us in passing what are necessary reforms,” he said in addressing the interested parties. “Don’t fight them.” More»

(NEWSER) - President Obama wants to put the so-called dark markets under control, the New York Times reports, seeking congressional approval to regulate the byzantine world of derivatives trading—which played a large role in the current financial mess. In a letter to lawmakers, Treasury chief Timothy Geithner calls for an oversight system to be run either by the Securities and Exchange Commission or the Commodity Futures Trading Commission. More»