But after becoming President, he needed to set Wall Street back on some sound footing, for the sake of 401Ks and the general economy.
Then he asked for them to give back,
and realized at some point that they weren't gonna sacrifice
anytime soon....
So I guess, he lowered the Boom!
Volker was welcomed back in December.....
However the Bank proposal may have been postponed due to Haiti.
The interesting part of this story is that Obama and Volcker went to work on this in December (about the same time as Volcker came off the reservation and started making more frequent speeches).
It'll hurt if Volcker has his way
The former Fed chief's tough tactics curbed an '80s downturn. He has a similar prescription as an Obama advisor.
December 08, 2008Now Volcker is back, tapped by Barack Obama as a special economic advisor. And if the president-elect follows his advice on the current economic crisis, there could be pain again and no doubt many protests -- but also the possibility of long-term benefits.
In speeches, interviews, public policy reports and congressional testimony, Volcker, 81, has laid out a fairly clear outline of what he thinks is wrong with the present-day financial system and the government's management of the economy.
snip
Clearly, he wants tough new regulations on securities markets, including oversight of hedge funds, in order to avoid the need for a bailout effort by the Fed ever again. It seems likely that he will advise Obama that the growth of U.S. consumption -- everything from government spending to household outlays -- should not be financed by selling ever larger amounts of debt to foreign interests.
http://articles.latimes.com/2008/dec/08/nation/na-volcker8 I think he put the bankers on notice, and they ended up not doing as asked....
Obama to banks: 'Rebuild our economy'
By Jennifer Liberto, CNNMoney.com senior writer
December 16, 2009: President Obama pressed Wall Street bankers at the White House on Monday, urging them to make more loans and modify mortgages to help taxpayers who propped their banks up with federal bailouts.
"My main message in today's meeting was very simple: America's banks received extraordinary assistance from American taxpayers to rebuild their industry," Obama said. "Now that they're back on their feet, we expect an extraordinary commitment from them to help rebuild our economy."
In his public statement after the meeting, Obama said he also took bankers to task for lobbying "vigorously" against parts of the financial legislation to reshape the regulatory system and prevent future financial crises.
"Short-term gains are of little value to our banks if they lead to long-term chaos in the economy," he said. "I made very clear that I have no intention of letting their lobbyists thwart reforms necessary to protect the American people."
The bank executive who attended the meeting said the president asked bankers to support financial regulatory reform, and everyone in the room appeared to agree with him.
We share the President's goals of strengthening lending to all sectors of the economy, helping homeowners avoid foreclosure, aligning compensations practices with long-term risk horizons, and modernizing the regulatory framework," said group president Steve Bartlett.
http://money.cnn.com/2009/12/14/news/economy/Obama_bankers/index.htmSo Obama turned to Volker to get her done.
As I understand it, the bankers were kept in the dark about these new proposals. The story started to leak this Tuesday afternoon and when the bankers started calling the WH yesterday for an explanation, they did not get a warm reception.
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