“’You could potentially use this to unravel big chunks of Dodd-Frank,’ said Marcus Stanley, policy director for Americans for Financial Reform, a coalition that includes the AFL-CIO labor union. The CFTC should institute a default presumption that affiliates are guaranteed by their parent company unless a bank can prove otherwise, he said.”
“We don’t believe that this is enough,” Marcus Stanley of Americans for Financial Reform told the Washington Post. “Raising $60 billion in extra capital is helpful, but it’s really not in line with the kinds of risk we saw in the financial crisis.”
“’There are provisions in this bill that would effectively unwind a good deal of the work the CFTC has already done and make it much harder for them to regulate the derivatives markets,’ Marcus Stanley, policy director for Americans for Financial Reform, a coalition including the AFL-CIO labor federation, said in a phone interview.”
“The 2010 Dodd-Frank financial reform law required the Fed to restrict its emergency lending powers so that too-big-to-fail banks don’t expect the central bank to dole out easy money again in the event of another financial crisis,” writes Erika Eichelberger of Mother Jones. Three years later, the Fed has come out with a draft rule that “misses the mark,” interpreting “the statute in ways that minimize limits on emergency lending authority.”
While the Administration wants to increase the CFTC’s budget, its $280 million request for FY 2015 is $35 million less than last year’s proposal, The American Banker points out. “We have the mandate, but not the money, to do the job,” Commissioner Bart Chilton said in a press release. Americans for Financial Reform, the story adds, has described underfunding of the CFTC as “a backdoor attack on derivatives regulation.”
Timothy Massad, nominated to lead the CFTC, “has drawn skepticism from [public] interest groups about his views on regulation,” according to Bloomberg, which cites Marcus Stanley, policy director for Americans for Financial Reform. “He’s really something of a blank,” Stanley said. “He doesn’t have a policy or substantive record at least in the areas regulated by the CFTC.”
“First, if you don’t like a bill, amendment or provision thereof, you try to defeat it with a vote. Just say, then vote, no (or nay, or whatever). If that fails, go to stage two. You can try to defund it through the appropriations process. If that doesn’t work, there is stage three. This is where you can try to stop it, change it or delay it through the regulatory rule-making process. If all of those things fail, you can go to DEFCON four: litigation. That’s the D.C. Quadrakill: 1. kill bill; 2. defund it; 3. regulate it; and, 4. litigate it.”
“Lisa Donner, head of Americans for Financial Reform, contends the CFTC budget was slashed at the behest of Wall Street lobbyists seeking to undercut the effectiveness of financial reform. The budget savings are so miniscule that ‘it’s not plausible that the real issue is budget numbers,’ she says.”
“Though small compared to Wall Street and the right, groups like Americans for Financial Reform and Better Markets show up extensively in the comments on the Volcker Rule. In the final rule, there are hundreds of references to the detailed comment letter the Occupy the SEC group sent…” The work of these outside groups “is a major piece of what makes solid final rules happen.”
“The strength of the rule is the scope of the compliance regime,’ said Marcus Stanley, policy director of Americans for Financial Reform. “The regulators correctly realized that most proprietary trading is hidden within supposedly innocent activities like hedging or market making.”