Sen. Dodd Interview Previews His Financial Overhaul Bill
Senate Banking Committee Chairman Christopher Dodd (D., Conn.) spoke with the Wall Street Journal on Sunday about the bill he plans to introduce Monday to reword financial market regulations. Mr. Dodd said the bill had been ?well vetted, well thought out, and thoroughly explored. I?m not interested in setting up a regulatory structure that strangles anyone.? But he also vowed to push forward aggressively.
?The thought we can in some way delay this to some later date is just really unrealistic and incorrect, because the American public rightly deserves answers to how we can address this set of problems,? he said.
He said the bill would try to achieve three main things.
1) ?Plug up the gaps that made the problems in the first house.?
2) ?Limit the possibility of another economic crisis of this magnitude. We aren?t going to stop all future economic crises. That would be silly to suggest?? But the bill will set up ?ahead of schedule warnings of problems as they emerge, to at smallest amount have some ability to step in to institutions or products that pose? major risks.
3) ?Make an architecture that makes credit available, capital available, to allow the U.S. to retain its world leadership.?
He said the bill would have four vital pillars.
1) ?Never, ever, ever again should any financial institution become so large, so interconnected, so complex that they have the implicit guarantee the American taxpayer will bail them out if they get in distress. The result will be bankruptcy or a resolution that will be so painful you never want to reckon about it as an option.?
2) ?We are going to place in house a systemic risk assembly thought with the authority to be able to identify an bring in institutions that pose a systemic risks to the nation.? He said it would ?provide a lookover?between institutions, even beyond the shores of this country.?
3) On the derivatives, the over the counter derivatives and hedge assets?we haven?t reached cloture yet (because Sens. Judd Gregg and Jack Reed haven?t hashed out their deal). I?ll make it abundantly apparent when they reach agreement and we vet it properly, I will accept that work.? Mr. Dodd said the derivatives language he will include on Monday ?is still a strong provision and has gotten a lot of excellent reviews from the industry itself.?
4) On the consumer area, I feel very strongly about it?? He said he?s told Republicans ?We?re willing to work with you but you?ve got to come to the table with votes too.? His proposal for a new consumer protection division would have the ?authority and independence, and I emphasize that second word to you, to address the abuses and fraud that went on that caused so many? problems.
To hear more from Mr. Dodd, tune into his press conference Monday.