Obama calls for new 'rules of the road' for finance industry
Barack Obama said his administration would lay down "clear rules of the road" for the crippled financial industry.
By Agencies |
WASHINGTON: US President Barack Obama said Wednesday his administration would lay down "clear rules of the road" for the crippled financial industry with a new 21st century regulatory framework.
"We can no longer sustain 21st century markets with 20th century regulations," Obama said after meeting his top financial advisors and senior lawmakers at the White House.
"Strong financial markets require clear rules of the road, not to hinder financial institutions but to protect consumers and investors and ultimately to keep those financial institutions strong," the president said.
"Not to stifle, but to advance competition, growth and prosperity."
The president blamed lax or poorly enforced regulation for allowing Wall Street to package mortgages into complicated financial instruments and in a perfect financial storm which helped cause the financial meltdown.
"This financial crisis was not inevitable," he said.
"It happened when Wall Street wrongly presumed markets would continuously rise and traded in complex financial products without fully evaluating their risks.
"Here in Washington, our regulations lagged behind changes in our markets, and too often regulators failed to use the authority that they had to protect consumers, markets and the economy."
Obama tasked his economic advisors to move ahead with formulating a new system of Wall Street regulation, after the talks, which included Treasury Secretary Timothy Geithner and senior Democratic Senator Christopher Dodd, chairman of the Senate Banking Committee.
The president laid out a series of principles for the reform, beginning with a statement that financial firms that pose a serious systemic risk to the rest of the market should face serious government oversight.
He said that the regulatory system and financial markets must be strong enough to survive the failure of several large institutions, adding that trust in the sector could only be rebuilt by transparency and openness.
The president also argued for "strong and uniform supervision" of financial products, strict accountability for finance executives and comprehensive regulation of all markets and institutions.
"We can no longer sustain 21st century markets with 20th century regulations," Obama said after meeting his top financial advisors and senior lawmakers at the White House.
"Strong financial markets require clear rules of the road, not to hinder financial institutions but to protect consumers and investors and ultimately to keep those financial institutions strong," the president said.
"Not to stifle, but to advance competition, growth and prosperity."
The president blamed lax or poorly enforced regulation for allowing Wall Street to package mortgages into complicated financial instruments and in a perfect financial storm which helped cause the financial meltdown.
"This financial crisis was not inevitable," he said.
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"It happened when Wall Street wrongly presumed markets would continuously rise and traded in complex financial products without fully evaluating their risks.
"Here in Washington, our regulations lagged behind changes in our markets, and too often regulators failed to use the authority that they had to protect consumers, markets and the economy."
Obama tasked his economic advisors to move ahead with formulating a new system of Wall Street regulation, after the talks, which included Treasury Secretary Timothy Geithner and senior Democratic Senator Christopher Dodd, chairman of the Senate Banking Committee.
The president laid out a series of principles for the reform, beginning with a statement that financial firms that pose a serious systemic risk to the rest of the market should face serious government oversight.
ADVERTISEMENT
He said that the regulatory system and financial markets must be strong enough to survive the failure of several large institutions, adding that trust in the sector could only be rebuilt by transparency and openness.
The president also argued for "strong and uniform supervision" of financial products, strict accountability for finance executives and comprehensive regulation of all markets and institutions.
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