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CFTC Commissioner Bart Chilton on Dodd-Frank’s implementation and impact on the financial sector.
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Bracing itself for the full implementation of Dodd-Frank regulators currently putting the finishing touches on the massive financial overhaul law.
But will Dodd-Frank really prevent another financial meltdown.
Let's ask CFTC commissioner Bart -- and bar I know -- gonna be testifying tomorrow to report on how it's going with the implementation of Dodd-Frank.
-- a -- But slow but sure Tracy we we haven't made as much progress says that the law required.
Of about 400 rules in the government.
We've only got about a 135.
So -- were slow but were plotting along and the reason we've taken our time Tracy is to make sure that we.
Strike the right balance that we get these things right in the week.
Don't cause some market migration to other countries and that we don't let that create some devastating Havoc on financial firms or market.
Strike is we've seen what happened before with sarbanes Oxley right.
It became.
-- -- US especially for small companies to deal with the administrative angle of and we watched a lot of companies not come public.
In our country because of -- -- that can't happen again.
Yet -- absolutely right that's why we need to sort of thread this needle.
And you know what we're trying to do so that people understand it is.
The systemic risk that is the risk to all of us some people call it too big to fail.
That was the problem in 2008.
That's why we lost.
Nine million jobs people lost their homes -- upside down their mortgage if it's because of that systemic risk that's what we're trying to resolve.
But.
Even width 400 new rules.
Do you really think you're gonna prevent another.
If we ever have another financial crisis I mean there are people out there that are smarter than all of us.
Figuring out ways to trade around every rule under the sun they do with the tax code they're gonna do with Dodd-Frank.
We we need to hire you because you're the one that understands that they are trying to do that you're absolutely right yeah.
Up but I do think it will help it Tracy said that -- It's that systemic risk that we need to get a handle on.
Now there's shirt and certainly there's gonna be issues in the future.
But we shouldn't have to have one of these 400 billion dollar hideous bailouts because one firmer a couple of firms look like they're gonna go down.
So what we're doing specifically in that regard as very briefly.
Are we're putting in capital requirements.
And we're putting in margin requirements and requiring things that go through clearing which is essentially like it goes through a bank to make sure that everybody has their money in place those they should make -- that it better for markets.
Better for consumers and ultimately better for our economy.
You know the vocal rule is a really big sticking point in which basically is -- a ban on proprietary trading among these banks.
Mary Schapiro was all over that SEC chair she's stepping down where -- that stands.
Well I she's very important in this and endeavor but there are really a couple of dozen regulators who -- working on the Volcker Rule there's five different agencies.
You know I've I've spoken often about it the problem in the reason the Volcker Rule was Clinton debt in the law is because.
Some of the banks had been actually betting against their own customers -- urged them to get into a fund.
And then once they got into the fund break the bank itself took the opposite position so there is sort of this duplex city of interest between the bank.
The Volcker Rule as you say Tracy would stop that by disallowing a proprietary trading what I.
Worry the most about though are the fees all the little fees that we're -- a little people will be nickel and dime to pay for this because -- these big banks.
There's sure they're not gonna pay for the costs of implementing this Dodd-Frank stuff.
It is gonna trickle down to all of us community banks are gonna get killed and every time we make a trade we -- the little people will end up getting her.
Well I I'm I'm not sure I agree a 100% but they are your right -- that the community banks that that mean those -- the good banks out there they're doing.
-- person service those aren't the guys that sent the economy over that 2008 fiscal.
-- that that's not the problem.
But -- look I'm not I'm not so sure Tracy that I'm worried about a little bit extra expense to save our economy in the future.
The financial firms in the financial sector has made profits every single quarter since the fall of 2008 every single quarter and by a lot.
They've got ten lobbyist for for every member of congress they spend more money on lobbying than any other any other sector of the economy.
So I you know I'm not that concerned about a little bit -- I don't want to be excessive certain.
And I do get concerned about pass through but I don't think that will ultimately good happen and we really need to protect these markets back.
I know I number -- 400 of anything sounds like two months and made part still and thank everybody and it's dime.
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