at the congressional development of the dodd-frank act regulatory process. the coalition has advocated a more transparent to reduce market for the imposition of lawful company regulatory standards that enhance financial stability while avoiding needless cost on end-users. we believe imposing bush did not contribute to the financial crisis would create more economic instability, restricts job growth, decrease productive investments and hamper u.s. competitiveness in the global economy. thank you. >> the appreciate that. ms. cohen, welcome to the panel. you recognize for five minutes. >> chairman terry, ranking member waters, my name is colin abbott direct tour at goldman sachs. the responsibilities include developing and delivering trading hedging and risk management solutions to the first otc trip to client specific focus on the market changes resulting from global regulatory reforms. and my current broadband church regularly with market participants that transacting swaps two miniaturist, excess liquidity and improve returns. thank you for inviting me to te

it's the guarantee the security and is in statute that predates dodd-frank. in the guarantee of the based swap is a security, so that happens when their side, as i understanding it any way. what we look to is 722 d. does it have a direct significant effect on the activities in the u.s.. and so that's where we use that -- >> it's guaranteed to the affiliate's. so in the large financial institution here are the guarantees for the offshore affiliate that assures that we are sitting in this room of the offshore of chile yet fails, the risk is great to come cascading back down here of the legal entity. >> as i said it takes a contrary view. summit actually theirs is more direct. >> the gentlelady fields backed. >> thank you. in dodd-frank, it was made clear that the clearing houses must provide open access to be transparent and that the repository is cannot bundle or require that additional services be brought from them. there are difficulties in this area and i would like to submit questions in writing on technical items koln. i would like to go back to the openi

tracy: wall street bracing for full implementation of dodd-frank. tracy: washington is bracing itself for the full implementtation of dodd-frank. but will dodd-frank prevent another financial meltdown, let's ask bart chilton. i know you are testifying tomorrow to report on how it is going with the implementation of dodd-frank how is it going? >> slow but sure, we have not made as much progress as law required. about 400 rules in the government we've done within 35, we'r135, we'reslow but floodingd the right balance, and get things right, and don't cause a market migration to to other country, and don't create a devastating havoc on financial firms or markets. tracy: we've seen before with sarbanes-oxley, it became arduous. that can't happen again. >> the systemic risk, the risk to all of us, some people call it, too big to fail. that is the problem in 2008, we lost 9 million jobs, and people lost their homes, that is what we're trying to resolve. tracy: with 400 new rules, do you really think you will prevent another -- if we have -- another financi

dodd-frank tried to change that. it put rules in place, capital and margin requirements, reporting including components and other checks on institutions ability to add risk to the system to put some bite so the people could understand what was going on. now, the cft, to its credit, has released roughly 60 draft rules and proposals. yet in the days leading up to the october 12 effective date, a number of the rules they were forced to issue these no action letters and guidance because they needed more time to act and to get it right. and we do need to give the regulators enough time to get it right and to really get it right because it's so critically important to an end away that we do not implement rules that drive business away from america, and that we do not implement rules that make it difficult for us to interact with the markets and other countries and certainly with the s. -- sec. but i feel that markets run much more on trust nan on capital. i would like to see america remain the financial capital of the worl

dodd/frank puts -- well, dodd/frank is yet to be entirely determined, but dodd/frank puts a cap on the companies' sort of old way of doing business and being profitable. these companies really need to ceo show they will make structural reforms and decide what they want to be when they grow up, and what i like about bank of america it committed to this in 2010, right? a lot of banks still are arguing that the reason why they are underperforming it's cyclical, not structural, so dodd/frank is not -- you know, dodd/frank is sort of an outside influence on the company, part of the structure of your bank, but this is basically right-sizing the offense structure of the banks, so that's what this calls about. revenues, we're very conservative. don't expect a lot of revenues. i think one of the most -- some of the most damaging things for the -- for the banks have been the card act which told them how they could price and re-price on credit cards. >> prop trading, the volcker rule. >> we'll see how that happens. basl 3, nobody excited about the implementation and the mortgage industry. i'm not

and dodd-frank is filled with that. we did see the effect of constituents. >> there is a question in the front. >> the gentleman in the front? >> the credits will -- in several banks--the one thing i thought was very interesting in this discussion, the thing i would like to point out is i don't believe you can regulate good decisions, i don't think you can regulate greed. what i found is this. you talk to the person at the bank, the ceo or someone making decisions i can assure you, the risk he is taking is well known but sometimes people get boxed into situations where they don't have choices. you have a result last year, picked the amount of money, and created that situation. you had -- do you think the shareholders take that into consideration? this level of profit to this level, you're going from this level to that. that is where things became problematic because -- it is just explored because the growth factor and the ceo of the largest processing company. and look at financials, and what are your sales? the market,

just in brief, sir, i'm sure you've thought about dodd-frank. i just want to get your basic take. what does dodd-frank mean to the financial system and to the economy as you see it, as you ascend to this position of chairman? >> well, i think the regulatory burden is huge and what dodd-frank has done is, number one, not addressed the true route of the financial crisis of '08, which was a lot of federal policies, frankly, that con joeled and mandated financial institutions to loan money to people to buy homes that ultimately they couldn't afford to keep. i know they're psychologically worse off. second, it adds layers, the weight, volume and load and uncertainty of the regulatory burden is a drag on our cap tap markets. besides fundamental tax reform, we ought to have policy that ensure we vlt deepest, most liquid. a huge part of our solution is economic growth and dodd-frank is a huge drag on that because what it does is it simply empowers bureaucrats with power and if they were so smart, we wouldn't have gotten into the pickle in the first place. >> many people say dodd-franks ke

dodd-frank is going to have worldwide implications. >> well, dodd-frank's really important to us.fact, i've spent personally a lot of time in washington over the last year as dodd-frank -- david: did they accept your input? >> for sure. the cftc, in particular. it impacts us in important ways because as our institutions execute interest rate swaps, they're going to have to be bilaterally cleared. or multilaterally cleared oz opposed to -- as opposed to bilaterally. and that's important. and we believe that risk management is important for canada -- liz: okay, so you're giving it a thumbs up at least in that area? >> well, i am in terms of concept. the key is how are the rules going to impact, and we're still waiting for all the rules to be written. there were roughly 2200 pages of legislation without rules. the devil's in the rules, of course. david: isn't it, though, naturally going to be more -- if you have more clearing involved, won't it increase costs for the traders? >> we don't think so. we think as products come onto multilateral clearinghouses that we'll actually be able

>> dodd/frank does not end the bailout are too big to fail. john: all this?t is left in here and even encouraged because it implies some banks will be bailed out. >> right. when you say the bank is systemic you say it is an institution to big and important and critical to allow to be left 57 they have labeled them systemic. it shows what happens and white increases the risk. the big banks can borrow money more cheaply because they think the government will bail them out. >> creditors know they will not be bailed out if they fail so they give them money at it cheaper rate. >> jpmorgan chase pays $4 interest but the small bank pays $70 $0.50. they stay small the big banks get bigger. >> the more likely you are to be bailed out. john: i do make more money. it does other terrible things? >> something people need to realize is dodd/frank and 900 pages but it is just a mandate that says you have to make rules on a variety of topics. >> it says go right to new 400 new rules there is 400 it requirements of those 1/3 have been finalized. many year not enforced. 1/3 ha

we knew were problems leading up to the two thousand and eight crisis only about thirty percent of dodd frank has been. leveraged too much using borrowed money borrowed money to fund your operations we haven't increased capital requirements which restrain leverage we have gotten more capital into the banks through the stress testing process and that's a good thing that is helpful but we still don't have higher rules requiring higher capital requirements it's pretty much left to the regulatory discretion and that's a bad thing i rely on some short term funding that was another problem during the crisis banks successively relying on on a very short term loans commercial paper repots that they would have to continuously rules and then of course once the crisis hit there really got scared nobody was listening to anybody including banks were not lending to each other so trying to have more long term debt as part of the funding balance of these large banks operations had actually gotten worse our knowledge on it has gotten for whatever reason. large banks are actually issuing less amounts of

>> dodd/frank does not end the bailout are too big to fail. john: all this?left in here and even encouraged because it implies some banks will be bailed out. >> right. when you say the bank is systemic you say it is an institution to big and important and critical to allow to be left 57 they have labeled them systemic. it shows what happens and white increases the risk. the big banks can borrow money more cheaply because they think the government will bail them out. >> creditors know they will not be bailed out if they fail so they give them money at it cheaper rate. >> jpmorgan chase pays $4 interest but the small bank pays $70 $0.50. they stay small the big banks get bigger. >> the more likely you are to be bailed out. john: i do make more money. it does other terrible things? >> something people need to realize is dodd/frank and 900 pages but it is just a mandate that says you have to make rules on a variety of topics. >> it says go right to new 400 new rules there is 400 it requirements of those 1/3 have been finalized. many year not enforced. 1/3 have be

. >> dodd/frank was supposed to end too big to fail. how come we're still talking about? >> because if my opinion it's institutionalized. hasn't end it had at all and that's one of the leading reasons i'm against dodd/frank at all. >> what's the point of dodd/frank if one of the key elements of it isn't even doing anything and the rest of it, it's not even implemented yet? >> well, you know, i'm probably not person to ask to defend dodd/frank because i voted against it. i was against it really every step of the way. in terms of what it was about, i would point to a very early quote from rahm emanuel, then white house chief of staff. he said, talking about the 2008 financial crisis, we're not going to let a good crisis go to waste. i think dodd/frank was 90% about advancing a pre-existing political agenda, not solving real problems that existed in the 2008 crisis. >> yeah. i think you're not alone this that belief. senator, good to have you on the program. >> thanks, maria is there we'll be following your work. see you soon. >>> up next, general partner jeff jordan is soun

. >> governor romney says he wants to repeal dodd-frank. it appears we have some agreement that a market place to work has to have some regulation. in the past, governor romney has just said, roll it back. so the question is, does anyone out there think that the big problem we had is that there was too much oversight and regulation of wall street? because if you do, then governor romney is your candidate. but that is not what i believe. >> that is not the facts. we have to have regulation in wall street. that is why i would have regulation but i would not designate five banks as too big to fail and give them a blank check. that is one of the unintended consequences of dodd-frank. we need to get rid of that provision because it is killing regional and small banks. you say we were giving mortgages to people who were not qualified. exactly right. it is one of the reasons for the financial calamity we had. so dodd-frank correctly says we need to have qualified mortgages. if you give a mortgage not qualified, there are big penalties, but they di

it gives us tarp or dodd-frank.' push this into 20 13 and hope they can't pass anything then. >> it is true those arrows back to clinton administration, market seemso do pretty well? >> john, you have something brown on your nose you might want to look at. [ laughter ] >> i'm in the awkward position of agreeing, agreeing with rick and agreeing with nancy pelosi, that is hard for me to do. it's hard we do these things at the last minute, we don't make great decisions, but i don't have any faith it will be different in six months from now. we have stressful decisions will be made but i don't see it changing in this administration or congress. >> what will change, if we take your advice and kick it down six months, what is going to change? >> a lot is going to change in terms of how the economy is looking and around the world. a weakening economy. not since the 19 30s have so many governments raised taxes in the face of declining economy. it's putting more poison into the patient. republicans can do a lot of good propo

we have dodd-frank, and it's hard to argue we don't need regulation. citigroup has said it.but let's make sure it is sensible. we can end up in a situation where credit is less available for small and medium-sized companies. if you add to dodd-frank, everything that is coming at us, so small button community banks get hurt. small businesses, medium-sized businesses. it is the purpose to punish banks, maybe they are achieving it. if the purpose is to improve the economy we have to be careful. liz: may be the purpose is to make sure that we don't see another fiscal financial crisis disaster the likes of what we saw in 2008. we don't need that again. >> but we don't need to create another set of problems with these unintended consequences. with the amount of capital that banks have to carry with the regulations -- liz: european regulations. >> very difficult to have loans out to companies that don't have a credit record, companies that are not triple or double a, including small and medium-size businesses. so that is the big issue. it can be a very bad pun intended consequence

it gives us tarp or dodd-frank.h this into 20 13 and hope they can't pass anything then. >> it is true those arrows back to clinton administration, market seems to do pretty well? >> john, you have something brown on your nose you might want to look at. [ laughter ] >> i'm in the awkward position of agreeing, agreeing with rick and agreeing with nancy pelosi, that is hard for me to do. it's hard we do these things at the last minute, we don't make great decisions, but i don't have any faith it will be different in six months from now. we have stressful decisions will be made but i don't see it changing in this administration or congress. >> what will change, if we take your advice and kick it down six months, what is going to change? >> a lot is going to change in terms of how the economy is looking and around the world. a weakening economy. not since the 19 30s have so many governments raised taxes in the face of declining economy. it's putting more poison into the patient. republicans can do a lot of good proposal

. >> host: did dodd-frank bring in rein in some of the excess is a soft? >> guest: i think some of the excesses. there were some good things in dodd-frank, like the consumer protection bill, which was a good addition. there are some improvements to the way we approach the bank. that is on a good ledger. ultimately, i think that failed of what was supposed to do. which was the era of too big to fail. it was an opportunity for it to be effective. it was a bill was pending in the senate and actually had bipartisan support. it seems crazy to say those words these days. thinking that a major bill had bipartisan support to break up the bank. and that ultimately got about thirtysomething vote, but it got killed by the treasury department and the white house. they lobbied it and campaigned against it. afterwards, they told the media that the bill would've succeeded if they have been behind it, but they were. as a result, we didn't break up the bank. the bank was 20 or 25% larger than it was before the crisis. it was just as dangerous. by failing to take those step

this is the dodd frank law.ages that are supposed to protect us from those evil banks that the politicians say the banks took needless risks on mortgages because there has been de regulation. >> because it's reckless de regulation, if we do not act a bad situation will become worse. we are determined to get the bill through. i haven't read it but louise bennett has and she is a lawyer and specializes in these arguments. what's the problem? >> a lot of the myths surrounding this is the legislation which has led do -- >> i know growering wush. >> i was as ton nished george w -- george w. bush is known as the de regulator. >> banking is one of the most regulated industries if not the most regulated industry. the problem was not de regulation here. the problem was that whie had a crisis caused by a massive industry-wide miss investment in real estate. that was a direct result of government policies. >> everybody was encouraged to take out a mortgage. >> is that is right. i am assuming they are well intended. logic s

that's the fault of dodd-frank and the restrictions on lenders who have forced f.h.a. to be the lender of last resort, or most resort, for most american people. that's something we in the senate have the ability to fix. but we should not punish a talented, experienced, well-qualified, highly recognized individual who knows housing, both multi and single family, from being commissioner at f.h.a. so i rise to say to any member, if you have a problem with f.h.a., don't take it out on miss galante but look at what happened after the passage of dodd-frank and the fact that f.h.a. had to take on a burden because there was no other alternative in housing finance. what we need to do rather than defeating good nominees for office is give those nominees the kind of underpinnings where the laws allow capital to flow to the mortgage markets through various entities and numerous entities so the whole burden doesn't have to be borne by the insurance of f.h.a. and the united states government. so i rise with pleasure to say that i will vote in favor of carol galante for commissioner

>> dodd/frank does not end the bailout are too big to fail. john: all this?t is left in here and even encouraged because it implies some banks will be bailed out. >> right. when you say the bank is systemic you say it is an institution to big and important and critical to allow to be left 57 they have labeled th systemic. it shows what happens and white increases the risk. the big banks can borrow money more cheaply because they think the government will bail them out. >> creditors know they will not be bailed out if they fail so they give them money at it cheaper rate. >> jpmorgan chase pays $4 interest but the small bank pays $70 $0.50. they stay small the big banks get bigger. >> the more likely you are to be bailed out. john: i do make more money. it does other terrible things? >> something people need to realize is dodd/frank and 900 pages but it is just a mandate that says you have to make rules on a variety of topics. >> it says go right to new 400 new rules there is 400 it requirements of those 1/3 have been finalized. many year not enforced. 1/3 have

>> dodd/frank does not end the bailout are too big to fail. john: all this? that is left in herend even encouraged because it implies some banks will be bailed out. >> right. when you say the bank is systemic you say it is an institution to big and important and critical to allow to be left 57 they have labeled them systemic. it shows what happens and white increases the risk. the big banks can borrow money more cheaply because they think the government will bail them out. >> creditors know they will not be bailed out if they fail so they give them money at it cheaper rate. >> jpmorgan chase pays $4 interest but the small bank pays $70 $0.50. they stay small the big banks get bigger. >> the more likely you are to be bailed out. john: i do make more money. it does other terrible things? >> something people need to realize is dodd/frank and 900 pages but it is just a mandate that says you have to make rules on a variety of topics. >> it says go right to new 400 new rules there is 400 it requirements of those 1/3 have been finalized. many year not enforced. 1/3

>> dodd/frank does not end the bailout are too big to fail. john: all this? that is left in here and even encouraged because it implies some banks will be bailed out. >> right. when you say the bank is systemic you say it is an institution to big and important and critical to allow to be left 57 they have labeled them systemic. it shows what happens and white increases the risk. the big banks can borrow money more cheaply because they think the government will bail them out. >> creditors know they will not be bailed out if they fail so they give them money at it cheaper rate. >> jpmorgan chase pays $4 interest but the small bank pays $70 $0.50. they stay small the big banks get bigger. >> the more likely you are to be bailed out. john: i do make more money. it does other terrible things? >> something people need to realize is dodd/frank and 900 pages but it is just a mandate that says you have to make rules on a variety of topics. >> it says go right to new 400 new rules there is 400 it requirements of those 1/3 have been finalized. many year not enforced. 1/

>> dodd/frank does not end the bailout are too big to fail. john: all this?hat is left in here and even encouraged because it implies some banks will be bailed out. >> right. when you say the bank is systemic you say it is an institution to big and important and critical to allow to be left 57 they have labeled them systemic. it shows what happens and white increases the risk. the big banks can borrow money more cheaply because they think the government will bail them out. >> creditors know they will not be bailed out if they fail so they give them money at it cheaper rate. >> jpmorgan chase pays $4 interest but the small bank pays $70 $0.50. they stay small the big banks get bigger. >> the more likely you are to be bailed out. john: i do make more money. it does other terrible things? >> something people need to realize is dodd/frank and 900 pages but it is just a mandate that says you have to make rules on a variety of topics. >> it says go right to new 400 new rules there is 400 it requirements of those 1/3 have been finalized. many year not enforced. 1/3

so do you agree that from a dodd frank standpoint at the at the bank was on the brink can they fail is over and it won't get bailed out you know it pains me to disagree wish it was show there i agree with her probably about ninety nine point nine percent of things but on this one i do respectfully disagree with her and i think look i think this h.s.b.c. is proof positive that we still have a problem with too big to fail because if it wasn't such a concern. of been in play instead we have this residual fear that if we destabilized one bank that it could bring down the entire system and i think realistically if we're in the midst of a financial crisis we're going to be back where we were in two thousand and eight the banks were big then they're twenty twenty five percent bigger now and that proves that that that tendency towards val out the fear of what would happen otherwise i think is still in place and i think far more significantly that is still what the market believes so much of the distortions that come with too big to fail are based on the presumption of bailout it almost becomes

friends and we still don't have it fixed the title one what we call title one this of nations under dodd frank and those are basically the regulators as a council the group with the supermajority to say. this large financial situation is systemic it begun trouble it would get the rest of us in trouble so we need to put more regulation on there we need to say find out if they can be resolved in bankruptcy without hurting the rest of us that was kind of the type of situation that was meant to address that hasn't happened yet so yes the aspects of the shadow sector have not really been tackled the regulated sector has not really been tackled as much as it should have them and the problem is we're still looking in the rearview mirror trying to get these problems fixed for the credit crisis that we had two thousand and eight whereas moving forward i think the really the interest rate risk and the perhaps unintended consequences of this very protracted period of here's your interest rates that is the kind of the future thing that i'm worried about we're still looking you know backwards to try

went too far and certainly afterwards they use the financial crisis as an excuse to overregulate with dodd-frank, et cetera. >> welcome we are interviewing u.s. freedom fries. do you find a lot of opposition to some of the ideas in the book? >> now, people are very much -- that's at this event is about. it's about three people and free markets and people understand what's in this book. the whole idea that you the needs of people by free enterprise. what is free enterprise? if people try to meet their needs and the needs of others. that's what it's about. they understand entrepreneurial business. they understand effect to create jobs not through government, better innovation. innovation has created the most jobs. the government and then the automobile? no. >> elizabeth ames, what it's like to write a book? >> is a great learning experience and in a way that recertified higher education. customized and better. >> one of the themes we've been talking with authors here at freedom test about the moralism of a moralism about capitalism. is there a moral component interview? >> is the subject of the ne

dodd frank is vague.the environmental area, where the obama administration did not succeed to get the legislative wish list pass. they do that through the epa and regulatory way. if you put it together, i think the u.s. economy is people get off the back a little bit. take off a little bit. we have energy discoveries. we had a slow growth for three or four years. investment on the sideline ready to go. not in president obama's interest. he pulls back some, i suspect we could have the decent growth. they are aggressive regulators in the different parts of hhs, epa and financial areas. i don't know that the president is willing to rein them in. economic growth here. >> you mentioned the epa. inhof of the science committee issued a report back in october where he said the obama administration not just the epa but several agencies are working to find way to regulate the hydraulic fracturing at the federal level to stop the practice altogether. irony is fracking is one thing in the environmental -- excuse me,

dodd frank is vague.environmental area, where the obama administration did not succeed to get the legislative wish list pass. they do that through the epa and regulatory way. if you put it together, i think the u.s. economy is people get off the back a little bit. take off a little bit. we have energy discoveries. we had a slow growth for three or four years. investment on the sideline ready to go. not in president obama's interest. he pulls back some, i suspect we could have the decent growth. they are aggressive regulators in the different parts of hhs, epa and financial areas. i don't know that the president is willing to rein them in. economic growth here. >> you mentioned the epa. inhof of the science committee issued a report back in october where he said the obama administration not just the epa but several agencies are working to find way to regulate the hydraulic fracturing at the federal level to stop the practice altogether. irony is fracking is one thing in the environmental -- excuse me, manu

>> dodd-frank is in e implementation stage. i think part of this is the question whether can we micromanage? is this the right approach? 840 pages, 10,000 pages of regulation already read is this making the system safer? does our tax code give us a fair tax system? the question is whether the crystal ball that this officer of the comptroller of the currency is using. in his holding cell in china. gerri: regulators didn't see the last crisis. the kelihood is not high. but what more regulators would look at? >> fairly narrow things like the liquidity risk, interest rate risk, different things happening in the financial markets. now, what they are trying to do is look more broadly. for example, what sort of risk management systems these banks have in place? are they planning for the next ceo? are they communicating to the employees what sort of risks they want to undertake? gerri: didn't we see that with jpmoan chase? they made the big a big bet and lost a ton of dough? >> exactly. you can consider regulators are trying to take a

i thought to include a report of remittance, transfers in the dodd-frank provision. the report last year mentioned research that they plan to use the remittance histories to enhance credit scores. can you please discuss any progress being made in those research projects? yes >> , senator, let me thank you for making sure that report requirement was inserted in dodd-frank and it is an important issue of what kinds of information can help provide a complete history that gives all consumers an opportunity to get access to credit. we did provide an initial report last year and that dealt with some of the strengths and weaknesses we would anticipate would be involved in using remittance history. for context, lots of people who send remittances are people who have thin file so it was a great opportunity for a new kind of information to enrich our understanding of their ability to pay and their financial wherewithal. the downside is that it is not an obligation and therefore does not provide indications of whether an obligation has been met. since we completed that report,