The politics of Clinton’s play are fairly easy to divine. By picking a fight over shadow banking, she can distract attention from Sanders’s focus on his more populist proposals to break up the banks and reinstate Glass-Steagall, which for many progressives is a sorer spot on Bill Clinton’s legacy than even his impeachment. Clinton also is attacking Sanders’s perceived strength, knowing that if she can dent him there, the rationale for his challenge to her becomes much weaker.
.. But what’s interesting in the divide over financial regulation is that while Clinton has adopted some of the more popular items on the progressive wish list—debt-free college, expansive proposals on immigration, gun-control, and criminal-justice reform—she is relying on a wonkier approach to Wall Street reform.
Ex-Obama Aide Known As “Hedge Funds’ Secret Weapon” Assails Bernie Sanders’ Wall Street Overhaul
Goolsbee is now a partner at 32 Advisors, a financial strategy and government relations firm that works with Wall Street. He touts, on his company’s website, a 2014 CNBC profile where he was dubbed “hedge funds’ secret weapon.”
What Hillary Clinton Gets (and Bernie Sanders Doesn’t) About Wall Street
And if there is a central story of Wall Street since the nineteen-nineties, it has been the stagnation of the sell side and the rise of the buy side, because of technology, regulation, and new profit opportunities.
.. In the past decade, electronic-trading platforms that connect buy-side investors to one another have cleared out floors of traders and other sell-side intermediaries, leading to developments like Morgan Stanley’s recent decision to lay off twenty-five per cent of its bond and currency traders. Meanwhile, many of the Dodd-Frank regulations introduced, after the 2008 financial crisis, forced sell-side banks to shift in countless and surprising ways to less-risky business lines, becoming less profitable as a result.
.. When it comes to pay, yes, an investment banker at Goldman Sachs makes mad money, but in 2014, according to Forbes, the top twenty-five hedge-fund managers—individuals, not firms—made twelve and a half billion dollars from profits they earned as asset managers and appreciation in their own managed investments. That is only two hundred million dollars less than the total compensation expenses forevery employee at Goldman Sachs.
Hit by Sanders over Wall Street Ties, Clinton Invokes 9/11 Attacks
“Why, over her political career, has Wall Street been a major campaign contributor to Hillary Clinton?” the Vermont senator asked. “Maybe they’re dumb, and they don’t know what they’re going to get. But I don’t think so.” “There has never been a candidate — never — who has received huge amounts of money from oil, from coal, from Wall Street, from the military-industrial complex, not one candidate is like, ‘Oh, these campaign contributions have not influenced me, I’m going to be independent,’” Sanders said. “Why do they make millions of dollars of campaign contributions? They expect to get something. Everybody knows that.”
.. Sanders — who has refused donations from large corporations and super PACs — said Clinton’s Wall Street support explains why she’s unwilling to carve up the largest banks or reinstate the limits imposed by Glass-Steagall. “I’m not asking Wall Street for money,” he said. “I WILL break up these banks.” Accusing Sanders of “impugn[ing her] integrity,” Clinton tried to defend herself. “I represented New York, and I represented New York on 9/11,” she said, referring to her time in the U.S. Senate. “When we were attacked, where were we attacked? We were attacked on downtown Manhattan, where Wall Street is.
“I did spend a whole lot of time and effort helping them rebuild,” she explained. “That was good for New York, it was good for the economy, and it was a way to rebuke the terrorists that had attacked our country.”