Banks and the Trump administration see opening to bring back Wall Street casino in coronavirus crisis
The banksters are gonna bankster. Right now, they are gleefully rubbing their hands together as if they were washing coronavirus away, but in anticipation of the rollback of regulations they've been under since the last big economic crisis. You remember it—the one that they created a dozen years ago that nearly brought the global economic system down. Since then, they've been chafing under the modest rules imposed by the Dodd-Frank Wall Street reform law. But those rules are being eased under the current economic and public health crisis, and if the banksters have their way, there will be no going back.
The Federal Reserve and other regulators are loosening the rules on how much capital banks have to hold to be able to absorb losses; are allowing smaller banks to take on a higher debt load; and the Trump administration has delayed rules that would make them prepare against potential losses and set up systems to minimize risks. Trump’s cronies are doing their best to figure out how to weaken all these rules and turn Wall Street into a casino again. They see this as an opportunity, but the top Democrats in charge of banking oversight vow to fight.
"While our federal regulators, agencies and financial institutions must take action to protect consumers and our economy, I must emphasize that it is unacceptable to use this crisis as an excuse to justify rollbacks of important financial regulations that are in place to protect our financial system and economy," Rep. Maxine Waters, chair of the House Financial Services Committee, warned last month. "Wall Street will take advantage of anything to chip away at commonsense financial protections," Ohio Sen. Sherrod Brown, top Democrat on the Senate Banking Committee, told Politico. "Right now, as we deal with the economic fallout of coronavirus, we need the financial watchdogs to keep a close eye on the financial system. We need to be doing everything we can to protect hardworking Americans, not helping Wall Street and big banks skirt regulations."
Banks do need to have flexibility to make loans and keep businesses and individuals afloat. But they also need to not play roulette with the global economy, and Wall Street certainly has done nothing in the past 12-plus years to indicate it was going to watchdog itself.