Tagged: Senate

Wall Street reform bill threatened

June 29th, 2010 in Banks 0 comments

Sen. Robert ByrdThe death of U.S. Senator Robert Byrd (r.) is threatening to delay passage of the sweeping Wall Street regulatory reform legislation until mid-July after it had been on track for House and Senate votes this week.  Law Professor Cornelius Hurley, a former counsel to the Federal Reserve Board of Governors and now director of the Morin Center for Banking and Financial Law, says the proposed legislation has been so weakened in compromise efforts to garner enough votes to pass it in the Senate that it might be worth starting over.

“Its demise would have at least two significant benefits: first, it would allow the next Congress to develop a more robust bill, particularly with respect to systemic risk; and, second, it would enable global regulators to press the ‘reset button’ on international harmonization efforts, a vision apparently abandoned by this Congress and this Administration.”

Contact Cornelius Hurley, 617-353-5427, ckhurley@bu.edu

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Financial regulatory bill agreed on

June 25th, 2010 in Law 0 comments

buy & sell keysHouse and Senate conferees finally worked out a compromise bill aimed at reshaping financial regulations to avoid another Crash of ’08, with a final vote set for next week and President Obama expected to sign it by July 4th.  As expected: many winners and losers.  One controversial provision gives the SEC authority to require stockbrokers to protect their clients’ interest when recommending investments, potentially subjecting brokers to the same fiduciary duty as financial advisers.  Law Professor Tamar Frankel, author of “Trust and Honesty: America’s Business Culture at a Crossroad” and authority on securities law, says it’s about time.

“It offers a chance and a challenge for the SEC to become the leader that it used to be from the 1940s until about 1980.  It is a chance to bring about a far more reliable financial system and to refocus on productivity rather than betting.”

Contact Tamar Frankel, 617-353-3773, tfrankel@bu.edu

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Financial regulatory reform showdown

June 21st, 2010 in Banks 0 comments

stock market boardHouse and Senate conferees hope to wrap up this week the final version of financial regulatory reform legislation to send to President Obama, with chairmen Barney Frank and Chris Dodd delicately trying to compromises without losing votes for the overall package.  What do about the trading of derivatives – the complex financial packages which helped sink the economy – remains up in the air.  Law Professor Cornelius Hurley, director of the Morin Center for Banking and Financial Law and a former counsel to the Fed Board of Governors, says the proposal currently in the Senate version but objected to by both the House negotiators and the White House, wouldn’t be the best for taxpayers fearing another bailout but would be better than nothing.

“If derivatives trading is such a socially useful and profitable activity ($23 billion in revenue among the five banks that dominate the market) why can’t it exist outside of bank holding companies? The answer to the question is that it could exist in a different, nonbank setting, but, without the backing of the taxpayers, the activity would have to shed its casino-like features.”

Contact  Cornelius Hurley, 617-353-5427, ckhurley@bu.edu

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Arizona fighting the 14th Amendment

June 16th, 2010 in Law 0 comments

Arizona welcome signOn the heels of passing a controversial law involving screening illegal immigrants, the Arizona legislature is considering a bill that would deny citizenship to children of illegal immigrants, despite the 14th Amendment to the U.S. Constitution that specifically grants naturalized citizenship to such children.  Law Professor Susan Akram, an authority on immigration law, says getting such a law into constitutionally shape would mean having to amend the U.S. Constitution — which requires a two-thirds majority of both houses and approval by three-quarters of the states.

“Although Arizona’s effort to restrict the guarantees or benefits of birthright citizenship is by no means the first effort of its kind — and not likely to be the last — it has a very slim chance of passing constitutional muster.”

Contact Susan Akram, 617-358-3060, smakram@bu.edu

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The FDIC's deposit-insurance limit

June 16th, 2010 in Banks 0 comments

FDIC sealCongressional negotiators working out difference between the House and Senate financial reform bills are hammering out compromises right and left.  One would permanently (and retroactively to January 2008) move from $100,000 to $250,000 the deposit insurance on individual bank accounts.  Law Professor Cornelius Hurley, director of the Morin Center for Banking and Financial Law and a former counsel to the Fed Board of Governors, doesn’t think the raised limit is a good idea.

“Permanently raising the federal deposit insurance ceiling from $100,000 to $250,000 when the Federal Deposit Insurance Fund is over $20 billion in the red is irresponsible. By raising taxpayer-funded deposit insurance coverage … it seems the [banking] lobbyists’ messages are getting through loud and clear.”

Contact Cornelius Hurley, 617-353-5427, ckhurley@bu.edu

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Financial regulatory reform crunch time

May 24th, 2010 in Banks 0 comments

U.S. Capitol buildingCapitol Hill negotiators from the House and Senate committees dealing with financial regulatory reform are getting down to the details of working out differences between the bills passed in respective chambers, with Democrats holding the majority votes in both.  Former Federal Reserve Bank examiner Mark Williams, who teaches finance in the School of Management and is author of “Uncontrolled Risk” about the fall of Lehman Brothers, says the Fed simply isn’t equipped to take on any new oversight role over banks — as the Senate bill dictates.

“At the Fed, bank examiners continue to be underpaid, lack advanced training in the ways of Wall Street, and are saddled with risk-measurement systems that lag the Street.”

Contact  Mark Williams, 617-358-2789, williams@bu.edu

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Senate primary lessons

May 19th, 2010 in Politics 0 comments

voting boothU.S. Senate primaries — with Republican-turned-Democrat Arlen Specter defeated in the Pennsylvania Democratic primary, Arkansas Democratic Senator Blanche Lincoln forced into a run-off, and a hand-picked GOP candidate beaten by Tea Party favored candidate Rand Paul in Kentucky — may indicate an anti-incumbent mood in the country.  But political science Professor Graham Wilson cautions that the Specter loss proves no national trend and the Democrats also saved the late John Murtha’s House seat in Pennsylvania where the Republicans seemed favored.

“However, Paul’s victory does show that within the Republican party the tea party movement is a real force, one that might result in the GOP being encumbered with far right conservative candidates in the November elections.  It’s like the reverse image of the McGovernites taking over the Democratic Party in the 1970s.”

Contact Graham Wilson, 617-353-2540, gkwilson@bu.edu

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Healthcare reform heads to the floor

October 6th, 2009 in Health care 0 comments

healthcare reformThe great healthcare-reform debate now moves to the floor of the House and Senate where Democrats wrestle with balancing priorities between affordable insurance and comprehensive benefits.  School of Management Professor Stephen Davidson, author of “In Urgent Need of Reform: Saving the U.S. Healthcare System,” says it’s a false choice which doesn’t address the need for insurers to change.

“If we insist on using private insurers and don’t create conditions under which they would eliminate fee-for-service payments, then we will continue to face avoidable dilemmas like this.”

Contact Stephen Davidson, 617-353-7422, sdavidso@bu.edu

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