Tim Geithner: President Should Veto Any Legislation Weakening Financial Reform

Wall Street Journal:

In June 2009, the administration submitted to Congress a proposal that would fundamentally reshape the financial system. It was designed to lay a stronger foundation for innovation, economic growth and job creation with robust protections for consumers and investors and tough constraints on risk-taking. We drew on ideas and insights from reform-oriented thinkers across the political spectrum.

Read the whole story: Wall Street Journal

Comments

[BigDaddyWow]

02:15 PM on 07/21/2011

Hey Geithner, do you think the American people are stupid or are you just on dope? Moved fast? 2.5 years later you have a bill that 1) DOES NOT address TBTF; 2) Puts a lot of regulations on banks that they will gladly push to their customers and 3) has had it's teeth already pulled.

The TARP investment has made a profit? Assuming that it was not the greatest fraud in American history, the purpose of TARP was to restart the capital markets; which it did not do for 6 months. Furthermore, the lending environment for us small business owners is still terrible. America is in the ditch and you are talking about a couple billion in profit from the banks? What about the $4 trillion we have spent to revive this economy?

Transparency in the OTCD market will never happen while we have former Goldman stooges like Gensler running those critical regulators. Do you really believe we have integrity there?

The treasury and the fed have done very little other than lining the pockets of the very Wallstreet executives that destroyed our economy in the first place. As a business owner this is so wrong that I question whether America will ever be the same. So, grow some balls and do the right thing and push for meaningful controls over these markets otherwise your legacy will be one of failure and corruption.

[BroBrigham]

01:13 AM on 07/21/2011

Change heading to read: President should kick Geithner out of office. He was part of crew that got us into this mess. He was personally taking it up the tail pipe during the 90s and 00s by Greenspan, et al. all the while begging for more and our fearless leader puts him in charge of the purse!? For the love!! Our country really is run by the banks!

[xanas]

10:31 PM on 07/20/2011

All investments are by their nature speculative. There will always be risk, what government will always seek to do will either hinder good risk taking or induce more bad risk taking through subsidized loans or artificially lowered rates of interest.

The government can do nothing but make the financial sector worse. The Fed created the too big to fail institutions and ensured they would not fail. FDIC was just another backstop to prevent people from needing to take an interest in where their own money is stored.

[Kye154]

09:19 PM on 07/20/2011

Per article: "All financial crises are caused by too much leverage, and by reducing leverage, we have taken the most important step toward diminishing the risk of future crises". Wo really? The banks have more leverage and capital now than they did in 2008. Where is the justification for this statement? None of the TARP funding got down to where it was needed most. If you recall, the banks sent it all back, when the feds said they were going to control the bonuses the banking execs took from it, because they didn't want to play by fed rules.

Also: "We have forced the largest financial institutions to take less risk and to hold much stronger financial cushions against the commitments they make". This statement is entirely untrue. Regulations of Dodd-Frank haven't taken effect yet, no one is enforcing anything, and the banking industry is lobbying hard now to kill it, or water it down.

This is so much lying propaganda made up by Geithner to sugar coat things to placate everyone, but the reality is totally the opposite. It is also the reason why Geithner is wanting to jump ship right now. He does not want to be saddled with the next Great Depression, coming down the pike.

[had410]

08:13 PM on 07/20/2011

who asked this tax cheat to keep talking?

[Chuckles71]

07:56 AM on 07/21/2011

Somebody pulled his string....

[zmanusmc]

07:06 PM on 07/20/2011

Geithner is still working for Goldman Sachs ... just not getting paid directly. If the economy tanks to the point of default, he will be cashing in.

[DiogenesOfAlaska]

03:37 PM on 07/20/2011

Geithner wrote:

"Our banking regulators have reached global agreement on new capital standards that require the world's largest financial firms to hold roughly three times more capital relative to risk than before the crisis."

I'd say that all this depends a lot on what you mean by the word "global agreement". And "require". And "our". And "three".

But apart from these minor points, I'm all with you, Mr. Geithner.

Oh well, maybe not. Because it also depends on what you mean by "risk", by "crisis" and by "capital".

But other than that, as I said, it's ok with me.

Point being:

I'm really not against your efforts at all. I'm not against any regulatory efforts at all. What I'm against is the notion that these things are simple and tractable (as in: not rocket science, no new Los Alamos needed).

It IS rocket science. And a new Los Alamos is the very least that's absolutely required.

Face it.

But not: face it, Geithner. Rather: face it, banks.

Plus: face it, those who would love to shut down the government. It also depends on the meaning of the word "is".

[GoldsteinD]

03:27 PM on 07/20/2011

"in favor of Dodd-Frank financial reform"...foxes gaurding a hen house

when they eliminate mortgage deductions, they can blame low home prices on that instead Fannie Mae

[DRaymond]

03:05 PM on 07/20/2011

Gee, I wonder how much the comments would have changed if the exact same editorial had appeared under Paul Krugman's byline instead of Geithner?

And yes I agree with him 100 percent.  It is better to have the CFPB operate for a year or two under an acting head or a recess appointment than to allow the law to be decimated.

And then after a year or two they might, much like what happened with the CPSC businesses will realize that rules that allowed consumers to trust producers was good for both!

[andycan]

02:44 PM on 07/20/2011

GEITHNER A PATRIOT

Geithner started his term under a serious pall of doubt, but he turned out to be a towering figure as secretary of finance - and a real patriot.

Congratulations, Mr. Secretary!

[Tom95134]

01:15 PM on 07/20/2011

Never happen because that would require Obama taking a stand on something and making the people pushing for change very unhappy.

I'm not going to be holding my breath on this one.

[Aikaterina]

12:56 PM on 07/20/2011

After being asleep at the switch, while chairman of the NY FED, and all the wild speculating and over-leveraging was going on, Geithner spent most of his time coddling-placating his pals who were the cullprits of the financial institution's melt-down, crashing markets and collapsing our economy.

So now, he's all in favor of Dodd-Frank financial reform legislation. First of all, that bill doesn't come close enough to protecting banks, the government or public (consumers).

Banks via their lobbyists-lawyers or "in-pocket" legislators, negotiated the new liquidity requirements down, refused to curb the obscene bonuses and incentives for those who recklessly speculate, still have government guarantees against future losses (courtesy of TARP), able to delay-thwart remedies (program incentives-directives) for distressed homeowners, refuse to prudently lend to credit-worthy businesses or individuals, and are still rapidly-ruthlessly (in many instances fraudulently) foreclose on properties.

Not one CEO of a major bank, even those guilty of violations of the previous (inept, lax laws that existed) have been held accountable. In each instance, banks paid a paltry fine, promised to "reform" and went back to business-as-usual.

[DocSyracuse]

12:46 PM on 07/20/2011

Hey, Timmy- The "financial reform" we got couldn't get much weaker. It wouldn't even stop a repeat of the housing market crisis.

[cornel]

12:43 PM on 07/20/2011

For once I am 100% with Geithner. The question is does Obama have the guts, something tells me no he does not !

[karen1p]

12:37 PM on 07/20/2011

Is the snake starting to understand how badly he undermined the homeowners as he heads out the door???