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‘Big banks couldn’t be happier’: Stocks surge as Trump regulators gut restrictions on risky Wall Street gambling

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Traders work on the floor of the New York Stock Exchange (NYSE) in New York, U.S., December 10, 2018. REUTERS/Brendan McDermid

The rollback, noted the Wall Street Journal, hands “Wall Street one of its biggest wins of the Trump administration.”

Bank stocks jumped and lobbyists rejoiced Thursday after U.S. regulators voted to gut the so-called Volcker Rule, a set of regulations imposed in the wake of the 2008 Wall Street collapse limiting the ability of financial institutions to engage in high-risk behavior that threatens the systemic health of the economy.

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“This is no longer the Volcker Rule. In the hands of revolving door regulators, it turns banks into Trump casinos. Will the inevitable Trump casino bankruptcy be far away?”
—Bartlett Naylor, Public Citizen

“Instead of protecting our financial system in the middle of an unprecedented economic crisis, Trump-appointed regulators are plowing ahead with their dangerous deregulatory agenda,” tweeted Sen. Elizabeth Warren (D-Mass.). “The big banks couldn’t be happier about it.”

CNBC reported that the shares of JPMorgan Chase, Goldman Sachs, Wells Fargo, and Morgan Stanley “were all trading more than 2% higher” after the changes to the Volcker Rule were announced by five regulatory agencies, including the Federal Reserve, the Securities and Exchange Commission, and the Federal Deposit Insurance Corporation.

The changes, set to take effect on Oct. 1, will make it easier for big banks to devote more of their resources to investments in venture capital funds and other vehicles—the kind risky of speculation that sent the entire U.S. financial system into a tailspin in 2008.

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Regulators on Thursday also eliminated a requirement that banks set aside a certain amount of financial cushion to protect against trading losses. The rollback could free up tens of billions of dollars for Wall Street banks.

The Wall Street Journal reported that the combined deregulatory moves hand “Wall Street one of its biggest wins of the Trump administration.”

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Sen. Jeff Merkley (D-Ore.), one of the authors of the original Volcker Rule regulations, warned in a statement Thursday that the changes further destabilize the U.S. financial system at a time when the economy is already reeling from the coronavirus crisis.

“Deregulation of the banks is exactly the wrong way to boost our economy in this moment,” said Merkley. “The last thing we need is to follow a public health crisis that has cratered our economy with another Wall Street-driven financial meltdown.”

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“It was only a decade ago when millions of Americans paid the price for Wall Street gambling in lost jobs, homes, and life savings,” Merkley continued. “Reopening the Wall Street casino is the wrong path forward, one that puts all Americans’ financial stability at greater risk.”

Bartlett Naylor, financial policy advocate at consumer group Public Citizen, echoed Merkley’s warning in a statement Thursday.

“This is no longer the Volcker Rule,” said Naylor. “In the hands of revolving door regulators, it turns banks into Trump casinos. Will the inevitable Trump casino bankruptcy be far away?”

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2020 Election

Trump officials could face criminal charges for USPS sabotage — and the president may not be able to pardon them

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Members of the Trump administration could face legal jeopardy over efforts to sabotage U.S. Postal Service operations to interfere with the 2020 presidential elections.

"Rep. Bill Pascrell, Jr. (D-NJ) made a criminal referral to the New Jersey Attorney General on Friday night, asking him to impanel a grand jury to look at possible breach of state election laws by President Trump, Postmaster General Louis DeJoy and others for 'their accelerating arson of the post office,' he said. Alarming headlines have emerged in recent days as many states prepare to facilitate widespread mail balloting due to the coronavirus pandemic. President Trump openly admitted he was withholding federal aid from the postal service to prevent mail-in voting, and USPS has notified 46 states and D.C. that it will struggle to deliver some mail ballots on time," The Daily Beast reported Friday.

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Maddow reveals how one state stood up to Trump’s USPS cuts — and won

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MSNBC anchor Rachel Maddow's opening segment on Friday focused on a positive story of political pressure stopping one of the Trump administration's attacks on the U.S. Postal Service.

Maddow reported how NBC Montana reporter Maritsa Georgiou had doggedly reported on the removal of postal boxes in Missoula, where she is based. Missoula has been a long-time Democratic Party stronghold.

Montana has a competitive U.S. Senate election in 2020, with Democratic Gov. Steve Bullock challenging first-term Republican Sen. Steve Daines.

As Georgiou chased the story, she learned there were also plans to remove boxes in the battleground of Billings. And more planned for the blue town of Bozeman. And other towns.

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2020 Election

Pepsi joins the chorus of people dunking on Tucker Carlson over Kamala Harris

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The Pepsi soda company mocked Fox News personality Tucker Carlson on Friday evening.

On Tuesday, Carlson flipped out after a guest attempted to teach him how to pronounce the name of Sen. Kamala Harris (D-CA), who is running for vice president on Joe Biden's ticket.

Video of the exchange was posted on Twitter by Nikki McCann Ramirez, a researcher at the watchdog group Media Matters for America.

Tucker Carlson loses it when a guest corrects his pronunciation of Kamala Harris's name pic.twitter.com/1fHIrPGuwN

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