Calling our current financial regulatory regime "more an accident than anything else," Sen. Chris Dodd (D-Conn.) appeared on Dylan Ratigan's Morning Meeting to discuss the sweeping reform bill he unveiled yesterday.
Dodd's bill has been called far more aggressive than the financial reform bill being weighed in the House of Representatives. Under the proposed measure, the Federal Reserve would be stripped of much of its power and in its place will be a new regulatory council to oversee systemic risks to the economy. The bill, Ratigan said, has several promising components, including crackdowns on derivatives, increasing capital requirements for banks and a clause that would allow the government to clawback pay from execs at publicly traded companies.
"We have an architecture of federal regulatory structure -- some of it dates to the 19th century... It's just so outdated. It's a hodgepodge. It's an accident more than anything else... If there's any silver lining in the last several years of this very dark cloud in our economy it is that I think we got a chance to do what you very effectively described as [something], bold."
Ratigan called the bill "better than expected," but added that the bill does not address the $18-billion-profit market in foreign currency swaps, which makes up to 40 percent of banks' derivatives income, according to research by Huffington Post's Shahien Nasiripour.
What does Dodd say to the financial services lobby, which is, of course, opposing the bill? "My argument to them," Dodd said, "is that what we're doing is in your interest. Having clarity and transparency -- your customers need this. You need this as well... In their heart of hearts, they realize what I'm talking about here makes sense."