Free Republic
Browse · Search
News/Activism
Topics · Post Article

Skip to comments.

Financial sector frets reform may hit business
Reuters via Fidelity.com ^ | April 26, 2010 | Paritosh Bansal and Megan Davies

Posted on 04/26/2010 8:35:38 PM PDT by mlocher

BEVERLY HILLS, California (Reuters) - Financial services executives are apprehensively watching regulation reform make its way through Washington, worried measures such as a bailout fund and restrictions on derivatives would hurt business.

But executives, investors and advisers at the Milken Institute'sGlobal Conference agreed on the need for reform of financial regulation to prevent crises in the future.

"We need a bipartisan bill here because we need both sides to contribute their best ideas to this reform. And we need reform," said Kenneth Griffin, the chief executive of hedge fund Citadel Investment Group. "It will hurt business if we end up with poor legislation."

Indeed, the future shape and profitability of the banking industry hangs in the balance on the most sweeping overhaul of U.S. banking rules since the Great Depression, which is making its way through Congress now.

Mohamed El-Erian, co-chief investment officer of Pimco, which manages the world's largest bond fund, said the banking system "is on a journey toward being much more utility-like because the benefits of stability today are being viewed to exceed the benefit of efficiency."

"No society can accept a system that privatizes massive gains and socializes massive losses," El-Erian said. "And therefore there will be a reaction, and history tells you that's likely to be an overreaction."

(Excerpt) Read more at news.fidelity.com ...


TOPICS: Business/Economy; Government; Politics/Elections
KEYWORDS: derivatives; financereform; regulation; volckerrule
This is a fairly good summary of the political debate concerning the Dodd bill. Unfortunately, the bill itself does nothing to keep another housing bubble from ocurring. It merely attempts to dictate winners and losers when the next bubble hits. Poor legislation.
1 posted on 04/26/2010 8:35:38 PM PDT by mlocher
[ Post Reply | Private Reply | View Replies]

Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.

Free Republic
Browse · Search
News/Activism
Topics · Post Article

FreeRepublic, LLC, PO BOX 9771, FRESNO, CA 93794
FreeRepublic.com is powered by software copyright 2000-2008 John Robinson