JPMorgan and the politics of financial reform

Editor’s Note: The following post comes to us from James R. Wigand, Director, Office of Complex Financial Institutions at the Federal Deposit Insurance Corporation, and is based on Director Wigand's testimony before the U.S.

ByDerek Chipman:In the most recent presidential debate Mitt Romney further expressed his opinion in regards to the Dodd Frank Act. He claimed that if elected, he intends to revoke the act. Although I do not believe the act will be revoked, it is highly probable that he will make amendments to it if elected. This article outlines the current legislation of the Dodd Frank Act and focuses on what effects the Volcker Rule has on some of the nation's largest financial institutions.

In 2008, Wall Streeters invested millions in Barack Obama’s campaign. Many of these big donors were thus a little miffed when Obama, as President, derided Wall Streeters as “fat cats” and, to add injury to insult, threw his support behind the Dodd-Frank bill, much hated in the financial sector it was designed to reform. This time around, Wall Streeters turned against Obama, sending an even bigger torrent of cash Mitt Romney‘s way. That didn’t quite work out as planned.

The Dodd-Frank Act, the sprawling law to address the causes of the financial crisis, is a job killer that should be repealed, Republican presidential candidates say.

From my article at the American.com (with Robert Dell),"More Equity, Less Government: Rethinking Bank Regulation":

If you’re like many of us, you may be wondering when people are going to stop uttering the phrase “In this economy, … .” Since the world’s financial system took a turn for the worst in 2007, this saying has been used time and time again by countless people. In fact, it is the underlying sentiment that contributed to U.S. regulators drafting the Dodd Frank Wall Street Reform Act of 2010 (“Dodd Frank” or “Act”). Dodd Frank, for those of you who don’t know, is a massive financial legislation intended to prevent a future financial Armageddon.