Republicans Halt Financial Reform Bill—For Now

Apr 27 2010 | 2:42am ET

Senate Republicans united yesterday to delay the massive financial regulation overhaul, but debate on the bill could begin as soon as this week anyway.

Thirty-nine Republican senators joined two Democrats—including, in a procedural move, the top Democrat in the Senate, Sen. Harry Reid—to block a floor debate on the bill, which would impose tough new rules on banks, hedge funds and derivatives trading, among other items. Democrats needed 60 votes to begin the debate; two Republicans did not vote.

“We’re not going to be rushed on another massive bill,” Sen. Mitch McConnell (R-Ky.), the Senate minority leader, said.

“We are as vulnerable as we are today in the waning days of April 2010 as we were in the fall of 2008,” Sen. Christopher Dodd (D-Conn.), head of the Senate Banking Committee, shot back. “Nothing has changed, except, of course, jobs have been lost, homes have gone into foreclosure, retirement incomes have evaporated, housing values have declined.”

Despite yesterday’s procedural and rhetorical fisticuffs, both sides expressed confidence that a financial regulation overhaul will be passed, and Dodd said he continues to negotiate with Sen. Richard Shelby (R-Ala.), the Republicans’ point man on the bill.

As written, the Senate bill would require hedge funds managing $100 million or more to register with the Securities and Exchange Commission. It also includes the so-called Volcker rule, which would bar bank holding companies from owning, investing in or sponsoring hedge funds or private equity funds.

The bill would also empower regulators to unwind financial institutions that have grown “too big to fail” and create a new consumer financial products protection agency. There would also be new rules governing over-the-counter derivatives, securitization and credit rating agencies.

There are differences between the House bill, which has already passed, and the Senate proposal, which would have to be worked out if the latter is passed. The House version requires hedge funds with $150 million or more to register and does not include the Volcker rule.


In Depth

JOBS Act Propels Real-Estate Crowdfunding Platform

Oct 21 2014 | 2:57am ET

If D.J. Paul were a real estate development, he would be described as “multi-use...

Lifestyle

MacDonald-Korth Offers Insights Into Paintings Bought, Sold By Hedgies

Oct 7 2014 | 9:00am ET

Definitive and complete ratings require an in-person examination of an artwork,...

Guest Contributor

PAAMCO: European Equity Exposure - Challenging Year, But All is Not Lost

Oct 16 2014 | 4:12am ET

European equity hedge fund managers have had a tough time so far this year. The...

 

Videos

Editor's Note

    Must Attend Hedge Fund Charity Events For October

    Sep 30 2014 | 9:29am ET

    The crisp Autumnal days of October are upon us, and so are a few of the hedge fund industry’s favorite charitable events. If you have never been to Rocktoberfest, well, you are missing out. And for a quieter evening of sipping and socializing, stop by HFC’s Wine Soiree. Read more…

 

Futures Magazine

October 2014 Cover

Deeply flawed risk benchmark

Most traders agree that proper risk management is the key to successful trading. However, many traders depend on the deeply flawed measure of standard deviation as a benchmark of risk. Here we put it ...

The Alpha Pages

TAP July/August 2014 Cover

The Alpha Pages Interview: Senator Rand Paul

Senator Paul sat down in the debut series of the Alpha Pages Interview to discuss the broken tax code, regulation surrounding Bitcoin, and his plans for the 2016 Presidential election.