Obama expected to propose new limits on the size and risk taken by the country's biggest banks

[DrToast]

Now we're getting somewhere...

WASHINGTON—President Barack Obama on Thursday is expected to propose new limits on the size and risk taken by the country's biggest banks, marking the administration's latest assault on Wall Street in what could mark a return, at least in spirit, to some of the curbs on finance put in place during the Great Depression, according to congressional sources and administration officials.

The past decade saw widespread consolidation among large financial institutions to create huge banking titans. If Congress approves the proposal, the White House plan could permanently impose government constraints on the size and nature of banking.

Mr. Obama's proposal is expected to include new scale restrictions on the size of the country's largest financial institutions. The goal would be to deter banks from becoming so large they put the broader economy at risk and to also prevent banks from becoming so large they distort normal competitive forces. It couldn't be learned what precise limits the White House will endorse, or whether Mr. Obama will spell out the exact limits on Thursday.

Mr. Obama is also expected to endorse, for the first time publicly, measures pushed by former Federal Reserve Chairman Paul Volcker, which would place restrictions on the proprietary trading done by commercial banks, essentially limiting the way banks bet with their own capital. Administration officials say they want to place "firewalls" between different divisions of financial companies to ensure banks don't indirectly subsidize "speculative" trading through other subsidiaries that hold federally insured deposits.

http://online.wsj.com/article/SB10001424052748704320104575015910344117800.html

It's not exactly a return to Glass Steagall, but it could have the same impact.

More Volcker, less Summers & Geithner please.

[taught_me_patience]

1. This is weak.

How about simply reinstating Glass Steagall? The "spirit" of Glass Steagall is the best he can do? Note to Obama... you do not start a negotiation with a watered down position!

[DrToast]

2. There wouldn't be any practical difference

The banks would basically operate under one name. But they can't commingle the businesses. And if one division failed, you don't have to bail out the whole damn thing. You just dissolve the failed part.

Done properly this would have the same effect as Glass Steagall.

[taught_me_patience]

3. I don't have much hope of this passing

And if it does, it'll be so watered down, it'll taste like Bud Lite.

[DrToast]

5. I'm just happy to see him fighting for the right things now

That's a big improvement. If he makes a good faith effort to get something, people are going to be less upset if he doesn't get it than if he never tried.

[taught_me_patience]

9. The more I read, the more I like this plan. K&R!!!

[democracy1st]

4. more bs from the Goldman Sachs admin!

[dionysus]

7. so obviosuly, you'll complain no matter what they do.

"wahhh! there's no regulation!!!11"

Headline: Obama to propose new banking regulations.

"wahh!!!!"

:eyes:

[phleshdef]

8. As another thread said, some of these posters are really starting to blow their cover.

[uponit7771]

10. Yeap, it was obvious weeks ago not they're overt

[TheKentuckian]

6. Purty please with sugar and cherries!