Skip to search.

Fat Cats Win Round 1 of Reg Reform Debate: Plus, Why Jamie Trumps Lloyd

Posted Jun 16, 2010 07:30am EDT by Aaron Task in Newsmakers, Banking
Related: JPM, GS, XLF, FAZ, MCO, MHP, C
Regulatory reform negotiations are underway and the early returns from the reconciliation process appear positive...for Wall Street and the status quo.

Financial stocks surged Tuesday as Bloomberg reported Sen. Blanche Lincoln (D-Ark.) is willing to compromise on her proposal to force Wall Street to separate derivatives trading from banking operations. The Financial Select SPDR (XLF) rose 2.2%.

The credit rating agencies also appear to have dodged a bullet: Lawmakers "could strip a provision designed to eliminate perceived conflicts of interest between the credit rating agencies and the companies whose debt they rate," Reuters reports. Shares of Moody's rose 6.6% while S&P parent McGraw-Hill gained 5.7%.

Halftime score: Fat Cats 2 - Taxpayers 0

Despite the early setbacks, Suzanne McGee, Barron's contributing editor and author of Chasing Goldman Sachs, says the reg reform bill "could be meaningful. [But] it's too early to say."

In additions to the dangers of "unintended consequences", McGee is concerned the bill does nothing to address the conflicts between investment banks and their clients that are at the heart of the SEC's fraud charge against Goldman Sachs.

McGee's take on the Goldman case is detailed here. In the accompanying clip, she and Henry discuss how the harsh spotlight being shone on Goldman is working to benefit JPMorgan and its Chairman and CEO, Jamie Dimon.

"He's at the peak of his power and prestige," McGee says of Dimon. "His reputation has probably been given an additional boost even as Lloyd Blankfein's has been pushed down a bit undeservedly."

Check the accompanying video for more on Dimon vs. Blankfein and whether JPMorgan is the "new Goldman Sachs."

Go to Tech Ticker

There are no comments yet

Post a comment

Sign in to post a comment, or Sign up for a free account.
Quotes delayed, except where indicated otherwise. Delay times are 15 mins for NASDAQ, NYSE and Amex. See also delay times for other exchanges.

Quotes and other information supplied by independent providers identified on the Yahoo! Finance partner page. Quotes are updated automatically, but will be turned off after 25 minutes of inactivity. Quotes are delayed at least 15 minutes for NASDAQ, NYSE and Amex. See also delay times for other exchanges. Real-Time continuous streaming quotes are available through our premium service. You may turn streaming quotes on or off. Fundamental company data provided by Capital IQ. Financials data provided by Edgar Online. Historical chart data and daily updates provided by Commodity Systems, Inc. (CSI). International historical chart data, daily updates, fund summary, fund performance, dividend data and Morningstar Index data provided by Morningstar, Inc. Analyst estimates data provided by Thomson Financial Network. All data provided by Thomson Financial Network is based solely upon research information provided by third party analysts. Yahoo! has not reviewed, and in no way endorses the validity of such data. Yahoo! and ThomsonFN shall not be liable for any actions taken in reliance thereon. All information provided "as is" for informational purposes only, not intended for trading purposes or advice. Neither Yahoo! nor any of independent providers is liable for any informational errors, incompleteness, or delays, or for any actions taken in reliance on information contained herein. By accessing the Yahoo! site, you agree not to redistribute the information found therein.