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President Obama Takes on Big Banks

  • Broadcast in Finance



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Two days after the voters of Massachusetts sent a Republican to the Senate for the first time since 1972 – many of them fueled by populist anger at Washington, DC, and Wall Street – President Obama used fiery, populist rhetoric to introduce new regulations on the financial industry -- almost daring the financial sector to take him on. "Never again will the American taxpayer be held hostage by a bank that is ‘Too Big to Fail,"the president vowed, suggesting ways to limit the size and scope of financial institutions. The president said he would work to change the current rules for financial institutions "in which hedge funds or private equity firms inside banks can place huge, risky bets that are subsidized by taxpayers and that could pose a conflict of interest." "We cannot accept a system in which shareholders make money on these operations if the bank wins, but taxpayers foot the bill if the bank loses," he said.