The old maxim among regulators holds that the more the regulated whine about what you’re imposing on them, the better you’re doing.
In that case, the Obama administration must be doing a wonderful job on regulatory reform of the US financial system. Everyone, it seems, is critical of the Restoring American Financial Stability Act, which was passing through the Senate as Euromoney went to press.
Banks have been urging the administration to get on with this quickly because the very uncertainty over regulatory reform is beginning to harm them. But it took the dramatic announcement of the SEC’s fraud allegations against Goldman Sachs in April to silence political opposition to reform and bring bipartisan support in Congress.
It is a huge, 1,300-page bill. One wonders if more than a handful of people have read it all. Clearly there is something in it for everyone to object to. As well as imposing new rules on different markets, the bill aims to overhaul the entire structure of regulation and the bodies that enforce it.
The American Bankers Association moans that the new consumer protection agency the bill sets up puts too much burden on banks, which are heavily regulated already, rather than focusing on non-banks which, the association rather boldly claims, primarily caused the financial crisis.