The provision was so important to the profits at those companies that J.P.Morgan’s chief executive Jamie Dimon himself telephoned individual lawmakers to urge them to vote for it, according to a person familiar with the effort.
.. It isn’t only liberal congressional Democrats up in arms about the proposed change. “It really is outrageous,” said a former senior Obama Treasury official, who asked for anonymity to preserve business relationships. “This was the epicenter of the crisis. This is what brought AIG down, what brought Lehman Brothers down.”
The nation’s biggest banks — led by Citigroup, J.P. Morgan and Bank of America — have been lobbying for the change in Dodd Frank, which had given them a period of years to comply. Trade associations representing banks, the Financial Services Roundtable and the American Bankers Association, emphasized that regional banks are supportive of the change as well.
.. But the regulatory change could also boost the profits of major banks, which is why they are pushing so hard for passage, said Simon Johnson, former chief economist of the International Monetary Fund and a professor at the MIT Sloan School of Management.
“It is because there is a lot of money at stake,” Johnson said. “They want to be able to take big risks where they get the upside and the taxpayer gets the potential downside,” he said.
William Dudley: The Fed is a Fireman, not a Police Officer
Dudley, said on Friday the Senate’s report raised “serious questions” as to whether banks should be allowed to own commodities businesses. However, Dudley, who likened the New York Fed’s regulatory activities to that of a fire warden, and not a police officer, was working to put out his own fires.
Remarks by Senator Warren on Citigroup and its bailout provision
SEC: Industry Staff Hired by Cox
Consumer and investor advocates have also been disappointed. Critics see an ideological link between the staff hired by Mr. Cox and today’s agency.
“When the chair doesn’t have a strong policy background, she is extremely dependent on her staff,” said Barbara Roper, the director of investor protection at the Consumer Federation of America. “Is there anyone on the staff in a high position in leadership, a single person to point to who has reform credentials, who isn’t someone from the industry?”