in 2010 he warned that the dodd- frank law would backfire... but he says he was up against a powerful lobby. >> imagine that you have angelina jolie at your door. you are a very big u.s. company, george clooney at your door saying you guys, you're the ones fueling the armed groups there. do you think that for the reputation of those companies they would be still sourcing from this region? they said ok we are stopping and that's what happened. >> soon after the law passed, companies took their business elsewhere. sales of tin ore from this province plummeted by more than 90%. >> ah the containers. >> that's the material ready to be exported. we are doing almost 2 containers while we used to do 8 containers per month. >> the only way john, or anyone in congo -- can now legally export to the u.s. is by opting into a system that traces the origin of the minerals. >> yes i can show you some. these are the tags. >> so these tags are attached to the bags of minerals that come here? >> yes. >> at mines that are determined to be "conflict free" bags of

a number of things dodd-frank does that i think help community banks, in terms dodd-frank of puttingter regulations on the large banks, the main competitors of community banks, and also the consumer financial protection bureau extends consumer financial projections the competitors of community banks. at the same time, there are continuing pressures. some of the regulation, there is a role for more technical assistance, especially with a very small community bank. it may not have the resources to devote someone full-time to regulatory compliance. in greaterrole technical assistance from the government to community banks. think dodd-frank does exempt community banks from a wide variety of regulations passed under dodd-frank. and the consumer financial protection's bureau has exempted things under $1 billion or $2 billion from a number of these protections. there is a role for these exemptions when they are used judiciously. problem we have to keep an eye on. but i do not believe dodd-frank is what is driving pressures in the community banks sector. host: a comment on twitter -- this on

thank you, chair. >> on that, dodd-frank specifically said your agency was to propose will.ou got any idea why the administration supported dol moving ahead of you? >>.frank mandated a study which the staff did, and gave the sec to proceed with the uniform fiduciary duty for broker-dealers under section 913 of that act. the initial department of labor proposal was in 2010. they do have responsibility and as we sit here today our broker-dealers are subject to some department of labor regulations so there has been overlap. >> is the sec going into look into developing their own rule? >> without question. i said some time ago my own view after extensive study, the agency has been studying this for a lot of years. my conclusion is the sec should proceed under 913 to do uniform fiduciary duty for investment advisors. >> who will harden out the two rules? >> you try to make them compatible, the coordination with fellow regulators where we have overlapping jurisdictions is enormously important. the title vii over-the-counter revenue space with the cftc but for an regulators. i want

>> first what dodd-frank it was to say that it mandates a study which the staff did.tudy, and gave the sec the authority if it decided to to proceed with the uniform producer duty for broker dealers and investment advisers under section 913 of that act. again the initial department of labor proposal i think was in 2010. they do have responsibility for the erisa space and even as we cq today, our broker-dealer a subject to some department of labor regulations and vice versa. so that the overlap -- >> is the sec going to look into developing your own rule? >> without question. i think i said some time ago my own to after billy extensive study, and the agency has been studying this for a lot of years and i spent a lot of time since i've been chairman. my conclusion is the sec should proceed under 913 to do a uniform producer duty. >> who is going to figure out how to harmonize the two rules? >> it's always, you try to make them at least compatible if you can get the coordination with fellow regulators where we of overlapping jurisdiction is enormously important. we have

we have new responsibilities under dodd-frank and the jobs act. we have to oversee the new crowd funding regime. we have examiners devoted to the volcker rule. it is spread out among, and i think smartly, the priorities and responsibilities that we have. if we were not to get it, we would clearly be compromising our mission, compromising the markets and compromising investor protection. >> i'm glad to hear you use the word enforcement, but i hate telling this story, but it can't be told enough. some years ago this agency -- you weren't there -- came to this subcommittee and actually said we don't need any more money, we're fine. we later found out why. they were not enforcing anything. only history will tell what role they played in that 2007-2008 fiasco. let me take you very quick will i to puerto rico, which is not a bad place to take anyone. puerto rico is in the midst of an economic crisis that is so bad it is really becoming a humanitarian one. your investment management division is urging funds especially those with exposure to puerto rico s

the dodd-frank act. we have done extensive research, we've assessed and analyzed millions of transactions. and again, what we found was a significant portion of the customer base, half of the total loans being made, payday loans nationwide, go to customers who are in a sequence of 10 or more loans. that is a debt trap, i don't know what else to call it. it creates tremendous harm for consumers. it's the exact point that was being made earlier, in the ranking member's example of someone taking out x dollars in loans, ening up repaying more in fees than they ever borrowed in the first place and still owing more at the end of all that than they borrowed in the first place. mr. hinojosa: thank you for your response. i strongly support your efforts to rein in those harmful payday loan practices. in my community we've seen some programs that cost 1/10 of what payday lenders charge but there just aren't enough of these programs. tell me about the 5% option included in the proposed rule, and will it be included

dodd-frank gave you significant year totals and oversight ability.is up to this subcommittee to make sure you are able to carry out the intent of that law. i want to mention another part of this equation that threatens to undermine the system of safeguards and protections regulated by the fcc. last year's appropriation bill are riders that were flawed. they opened up loopholes in d d dodd-frank and undermine the ability of the fcc to do its job. i want to thank you for your dedication to this agency and nation. you have a tough job and hopefully this subcommittee makes it easier rather than more difficult. i know you are a fellow yankees' fan and since baseball season is soon to be underway i am sure i will see you in the bronx soon. >> now we will turn to chair white for your opening statement. if you could keep it in the range of five minutes that will give us plenty of time to ask and answer questions. >> chairman, ranking member serrano, and subcommittee, i appreciate the opportunity to talk about why the funding at 1.871 billion is needed to ena

here's what dodd-frank says. it says the rule must be in the public interest for the protection of consumers and consistent with the study. my point is, your study shows that arbitration can sometimes and in many cases be in the best interest of the consumer, in terms of a faster resolution, a better result for the consumer, and so i would encourage the bureau to not move forward with a rule that is inconsistent with the benefits of arbitration. in preparing the study, did the bureau coordinate with the american association for justice? >> beg your pardon? >> did the bureau in preparing the study coordinate with the american association for justice? >> i don't know who that is. >> well, that's the trade association for class action lawyers. the reason i ask is, the bureau cites a study by professor sob urn that purports to analyze -- do you know how the professor's study was funded? >> i'm not familiar -- >> it was funded by the american association for justice. that's a conflict of interest that you have -- you'

my question is, we got cree ate dodd-frank, i'm all for dodd-frank, i wasn't here. there's a part of the dodd-frank legislation that talks about real financial literacy. and we're not doing enough -- in this committee, that's charged with looking at the banking industries, looking at the financial industry, looking at the credit union, industry, but we're not talking about a program, even from the minority dealers in their letter to me, it says, we're not dealing with the real issue of the transparency of the people's credit and we're not coming up with any legislation. so dodd-frank mandates that the cfpb's office of financial education shall, not maybe think about it, but shall develop and implement a strategy to improve financial literacy of consumers. it doesn't say consumers who go into a candy store, so that means a consumer who goes into an automotive dealership. they have to have financial counseling, information to assist with the evaluation of a credit product. let's say that product is a car. and the understanding of credit histories and scores. lastly, i

the dodd-frank act. we have done extensive research, we've assessed and analyzed millions of transactions. and again, what we found was a significant portion of the customer base, half of the total loans being made, payday loans nationwide, go to customers who are in a sequence of 10 or more loans. that is a debt trap, i don't know what else to call it. it creates tremendous harm for consumers. it's the exact point that was being made earlier, in the ranking member's example of someone taking out x dollars in loans, ening up repaying more in fees than they ever borrowed in the first place and still owing more at the end of all that than they borrowed in the first place. mr. hinojosa: thank you for your response. i strongly support your efforts to rein in those harmful payday loan practices. in my community we've seen some programs that cost 1/10 of what payday lenders charge but there just aren't enough of these programs. tell me about the 5% option included in the proposed rule, and will it be included

the dodd frank act. we've done extensive research. we've assessed and analyzed millions of transactions. and again, what we found was a significant portion of the customer base, half of the total loans being made, payday loans nationwide, go to customers who are in a sequence of ten or more loans. that is, a debt trap. i don't know what else to call it. it creates tremendous harm for consumers. it's the exact point that was being made earlier. in the ranking member's example of someone taking out x dollars in loans. ending up repaying more in fees than they ever borrowed in the first place and still owing more at the end of all that than they borrowed in the first place. >> thank you for your response. i strongly support your efforts to rein in those harmful payday practices. in my community we've seen some programs that cost 1/10 of what payday lenders charge but there just aren't enough of these programs. tell me about the 5% option included in the proposed rule and will it be included in the final rule? >> i can't speak to what may

a lot of the provisions in dodd-frank, ok, fine. but we had a lot of problems going into the 2008 collapse of the financial sector and a lot of it had to do with respect to consumer lending and consumer matters and that's obviously the mission of the agency, to deal with those kinds of things. o i didn't have anything specific i wanted to ask you. if you have anything you'd like to talk about. mr. cordray: there was a point made earlier that i think is inaccurate and misguided that omehow our rules have pushed the mortgage marketplace into the g.s.e.'s. the reality is that the irresponsible lending that precipitated the crisis and blew up the mortgage market and blew up the economy pushed most lending now to g.s.e.'s and eliminated, destroyed the secondary financing market which has not yet recovered. all of that preceded any of our rules which didn't even take effect until fife years after that. so again, just to set the record straight, there have been various statements today that i thought were not consistent with the facts. and

this is something for example dodd-frank. dodd-frank is killing banks that are owned by african americans. they cannot comply with this regulation. so let's talk about that for a little bit. talk about regulation and the role that plays. >> i call it the two r's. regulations are regressive. regulations raise the cost of government, the cost of living, the cost of everything and make it more difficult for people who are in poverty to get out of poverty. regulation raises the price of your food, the price of your clothes, the price of your energy, electricity. regulation makes it harder to create jobs. this is why one of the five planks of our agenda that we're putting out in the house of representatives is regulatory reform. but more importantly -- and it goes to self-government. who writes the laws in our country? is it the legislative branch of government under article 1 of the constitution who are dualy elected by the people or is it this fourth branch of government that nobody voted for, career bureaucrats, they don't know

we have a process under dodd/frank.f -- >> you're talking about the winddown process. >> yes, if any bank proposes a systemic risk, it can be broken up. >> sanders wants to do it preemptively. >> well, but we have a law. you know what, we are a nation of laws. we have passed a law which sets forth a process. now, you know, if you want to claim you can do it without following the law, that seems pretty radical to me. but what i have said is, i would support breaking up any bank that posed a systemic risk to the economy and we have a process now in place, thanks to dodd frank, thanks to president obama. we have got the tools. my opponent acts like he's going to create this. we passed a law. and the law gave us the tools. and if we meet the criteria, we should act. and i'm committed to acting. when you run for president, and we're seeing it very much in the other side, people make all these claims. and it's hard for voters to really evaluate, how do they decide? is this person, you know, being smart, are they just overprom

was bad. >> parts of dodd-frank have gone too far.tal levels made stones me. some other restrictions, the onus on smaller banks is problematic. joe i maintained this all along. you're getting older and you don't hear me when i say these things. >> i got my hole in my ear. >> what tax reform do we do >> the one everybody agrees on. corporate tax. they are at 28, we're at 25. why can't we go to 26 and a half. mark warner is coming. he's tried to do it. some of your guys, corker reaches across the aisle he gets his hands slapped. >> my guys. >> your guys. >> why do people who reach across the aisle get hit that's what i want to know. >> the reason is because we have an extreme political polarization because we don't have good executive leadership. >> on either side. not obama and not the republican leadership. >> from a highly polarized environment. >> dems are at 28, republicans are at 25. how we can't do tax reform in this country why can't we do that. trump said the same thing. you can fix social security. you can fix corporate tax re

chairman greenspan discussed china and his reticence about dodd-frank. is basically china itself. growthlowing down trader dramatically, and everyone who looks at the data will tell you they are not quite sure which data are real and which are not. i do think the 7.5% rate of annual growth is unachievable. i think that what is happening is as china's productivity edges ever closer to the united states, the gap closes and the ability to close the gap is more and more difficult, which means that you are going to get a convergence between productivity in the united states and productivity in china, much more closely. that means there is going to be a big slowdown in china. that divergence the renminbi and devaluation leading us to a dollar in the late 1990's? alan: i do not know the answer to that. i do say the united states, the u.s. dollar is unquestionably the firmest currency in the world, of major countries. it is hard to see where it goes from here. ,here are so many huge unknowns which, in my experience, i have never seen this many unknowns. michael:

he pointed to the effects of dodd-frank and said they're real. >> wall street reform, dodd-frank, theaws we passed, have worked. i want to emphasize this because it is popular in the media, in political discourse, both on the left and the right, to suggest that the crisis happened and nothing changed. that is not true. >> now, what the president was talking about was among other things the higher capital requirements on banks, which mean that the prospect of another crash and failure and big systemically risky institutions taking down the economy is much diminished. that's not what you hear from presidential candidates who look at how big banks are bigger and say we haven't solved too big to fail. president obama was rebutting them today. >> jeff harwood, thank you. do you like the banks or not? >> from a very, very long-term perspective i think there is a lot of value there, but -- >> that says no to me. couch it with very, very, very. very, very, very long-term. >> dodd frank is really -- we have the best tier one capital that we have ever seen. the banking system is definitely soli

barr: you have said you have a duty to enforce the law, the dodd frank law. here is what the dodd frank law says the rule must be in the public interest for the protection of consumers and consistent with the study. can study shows arbitration sometimes and in many cases be in the best interest of the consumer in terms of faster resolution, a better result. i would encourage the bureau to not move forward with a rule that is inconsistent with the benefits of arbitration. did the bureau in preparing the study cornet with the american association for justice? mr. cordray: i don't know who that is. mr. barr: the trade association for class-action lawyers. the bureau cites a study by a professor that purports to analyze consumers knowledge of whether financial agreements complain that contain an arbitration clause. do you not how his study was funded? it was funded by the american association for justice, that is a conflict of interest that you have. you're using data from a study funded by the class-action plaintiffs bar. mr. cordray: we took input from all stak

dodd frank is killing banks owns ed by african americans protect about regulation and the role that place. mr. ryan: regulations are regressive. they raise the cost of government. the cost of living. they raise the cost of everything and make it more difficult for people in poverty to get out. they raise the price of your food, the price of your clothing. they raise the price of electricity. it makes it harder to create jobs. one of the five planks of our agenda in the house, it is regulatory reform. i goes to self-government. who writes the laws. is it the legislative branch, elected by the people, or is it the fourth branch of government that nobody voted for, career bureaucrats. who are writing all the regulations that have the full force of law? take a look at the new regulation coming out of the obama administration that the supreme court struck down to reach 65% of power comes from coal in wisconsin. they were going to jack up our rates. it is kind of cold this time of year. with they were going to do is crank the cost up. who does that help the most question mark it hurts people wh

the obama's administration effort under dodd-frank?is a good question. i think we are somewhere between a b and c. i think real things have been done. they stood up to the consumer protection financialal bureau which a historic effort from the tricks and traps of the financial pilots. and i think we are talking close to an a there. that is a movement forward. they limited the number of risky borrowing the banks do. they had 30-40 borrowed for every dollar they had in hard capital. now we are down to 20 borrowed for every dollar of hard capital. still not enough but an improvement. at the same time as the president pointed out this we don't have all of the rules of dodd-frank written. it was written five or six years after the bill passed and we have some areas that are crucial to the financial prices and haven't been reformed. >> let's look at what the dodd-frank legislation did in terms of the overall comfort lefshl level. signed six years ago and ended the quote too big to fail bailouts, eliminates the loop holes for products and for

look behind it and see what's right and what's wrong and i think this combination, like i said, dodd frankof that stuff is really sucked out the liquidity in the market. everybody says these high frequency tradings provide liquidity but they go home flat and come in flat and they're providing liquidity during the day. it's not quality liquidity. >> i'm not smart enough to give you an answer but it's an issue. >> i wanted your opinion certainly. we'll take a quick break. i want to talk to you about energy on the other side as well. back with lee cooper man in a moment. the microsoft cloud allows us to access information from anywhere. the microsoft cloud allows us to scale up. microsoft cloud changes our world dramatically. it wasn't too long ago it would take two weeks to sequence and analyze a genome. now, we can do a hundred per day. with the microsoft cloud we don't have to build server rooms. we have instant scale. the microsoft cloud is helping us to re-build and re-interpret our business. this cloud helps transform business. this is the microsoft cloud. >>> welcome back. watching oil

wall street and the dodd-frank legislation. wall street crashed. i can remember being in the white house with the republican secretary of the treasury, wonderful man, secretary paulson, was on his knees begging nancy pelosi to work with him. the country was in a deep -- in deep trouble. democrats controlled the body. we had a republican president. and we worked with the republican president. in the shadow, republicans would not work with us to rein in the big banks and financial institutions. they had been warned by the republican administration and only one republican voted for that bill, only one. time and time again, congressional republicans went to the extreme to block any positive legislation to improve our nation. the tactics used to obstruct the president were unprecedented. in effect, the republican leader told the president that none of his policies would get a fair hearing from the republicans, and that's basically true. republicans denied the office of the president the respect it deserves. their shoddy and disrespectful treatment becam

there to celebrate lost jobs. >> i think he was obviously trying to make a broader point about dodd-frank good about reforming wall street but there are obviously downsize to it, talking about a loss of jobs when your wife is trying to win in part on the economy, helping the middle class. that is odd. at prior event, that was at union hall in new york city. he is doing four of them. i was at one before that, out of nowhere hillary clinton talking about benghazi, saying republicans railroaded his wife and stood up to him for 11 hours in the testimony and why he should be president. look he is dwindling her, benghazi is not what the campaign wants him to talk about. melissa: as he lost his mind? reporter: i think that is little much. melissa: no, no i'm asking the question. seems very off script. seems very unplanned. i mean to go out and talk about -- also i mean his voice isn't what we expect we've heard. he is very thin. reporter: has he lost his fastball might be the way, kinder more diplomatic -- i'm a reporter i like to keep it -- melissa: not me. reporter: at one time bill clinton wa

dodd-frank was a start but didn't go nearly far enough. do you see a different picture?very much so. in the first place, both senator sanders and mr. kashkari continue to evade the biggest question. that is: how big is too big? the crisis which touched off when lehman brothers couldn't make its payment, lehman was about $650 billion in assets. we have banks four and five times that size, and the question is: does everybody have to be smaller than lehman brothers is today? that would have consequences. getting there would be a problem. by the way, it should be very clear, glass-steigel doesn't do it. there is a disconnect between senator sanders insisting the banks be broken down to the point where they won't by their own size threaten to undermine it. glass-steigel wouldn't do anything to goldman sachs and to morgan stanley, which are almost glass-steigelized themselves. but look at city corp, bank of america, wells fargo, even if they were subject to glass-steigel, t etb be well beyond the size lehman brothers is. there a disconnect between saying we're going to do glas

in other words, they want to tinker with dodd-frank.but of course bernie frank said forget about tinging with dodd-frank, we've got to put a lot more muscle into it and hillary clinton slightly is the to the left even sharply to the left to completely revamp that financial lawn. now, the president of the united states i think, i think kind of on bernie's side on this. but that's me. and you know me and my math. stick around at ally bank, no branches equals great rates. it's a fact. kind of like grandkids equals free tech support. oh, look at you, so great to see you! none of this works. come on in. this just got interesting. why pause to take a pill? or stop to find a bathroom? cialis for daily use is approved to treat both erectile dysfunction and the urinary symptoms of bph, like needing to go frequently, day or night. tell your doctor about all your medical conditions and medicines, and ask if your heart is healthy enough for sex do not take cialis if you take nitrates for chest pain, or adempas for pulmonary hypertension, as it may

so you could actually paint a pretty bullish scenario around tax reform, around dodd frank reform, et cetera. the flip side of that with president trump, the problem with the president trump is just the sheer unpredictability and volatility that would come with it. with a president clinton, you're still in all likelihood going to have that policy put in the form of the republican house with paul ryan. so you're probably back to what brian was talking about with governing by crisis and more of the fiscal clips. but it's -- there's a pretty wide pendulum between the two. and look, the election's not for 250 days, so there's, there's a lot left to play out. >> brian, just on the point that a trump presidency will be unpredictable. if you're looking at what might happen. they're a very divided council, on the one hand you have a former dean of the yale school of management saying look, business needs to come forward, make its case and try and shore that he tracks to the middle, at the same time, you have bill mcgern, the former speech writer say look, personality driven politicians fail i

too big to fail, no executive too powerful to jail, and i have said i would use the tools in the dodd-frank regulations, that if any bank posed a systemic risk to the economy, they would be broken up. because we now have tools, laws that we didn't have before. and i am very happy we did. because there does need to be accountability, including criminal accountability if it is called for. >> senator sanders, i just want to show the audience, you sent a tweet -- i want to return to trade. you sent a tweet on thursday. this is the tweet. i'm showing it to the viewers. it said, "the people of detroit know the real costs of hillary clinton's free trade policies." p shows pictures of crumbling buildings. it seems like you're blaming her for the situation in detroit. >> i am blaming the trade policies. this is an amazing thing, which i didn't know until recently. i wonder how many people didn't know this. >> but you're calling them hillary clinton's free trade policies. >> hillary clinton and everybody else who supported these disastrous trade policies. she wasn't alone. we had many, many republica

in new hampshire we lost 20% of our small community banks since dodd-frank was enacted. a record number of regulations have led to less financial innovation and fewer choices for americans in today's budget i believe changes that course. it empowers our constituents and our communities and i want to thank the chairman and the entire committee. and i yield back. >> thank you, kindly. we now recognize the gentleman from arkansas. >> thank you, mr. chairman. budgeting for the expenditures of our nation is one of our most fundamental duties and i think thank you for your diligence in bringing us together to consider this balanced budget. then everything single one of us took an oath that we will support and defend the constitution of the united states than there is a debt that has eclipsed in $19 trillion. and we are less able to ensure the safety and security. so not only does this budget provide an essential roadmap to wean america off of our fiscally reckless path by cutting $7 trillion in spending, repealing obamacare making critical reforms to mandatory programs and ult

why firms are going after regulators, and what it means for the dodd frank act. let's go to the markets desk where julie hymen has the latest. happy quarter end. that was a rough quarter. julie: is that a thing? can we make the holiday? let's look at the quarter. just atwant to look u.s. stocks, but around the globe. one of the few major benchmarks around the globe in developed markets where we have seen a positive return. with the latest recovery that we have seen, it is up a little more than 1%. the stoxx 600 is down by 8% here the nikkei down 12%. the shanghai composite down 18%. -- down 15%. going back to bill gross, in terms of equity investments. that is what it looks like when the first quarter performance. the world market cap, because of the under performance, it is still down for the year to date. you can see 1.7 trillion dollars has been wiped off of the value year.bal market cap this even if we have seen something of a recovery it is till eight negative return year-to-date. outside of equities, we have seen a positive return through oil and gold year

so we have finished writing most of the dodd-frank rules. we are working very hard on too big to fail, which is of grave concern to the american people. in addition to having a financial system that is more robust and less likely to experience a failure, we have also worked very hard, continue to work on making sure we have the ability to resolve a firm if it were to fail in spite of having more capital and liquidity. and there, too, i think we have made very substantial progress. a month or so ago we came out with a rule, so-called tlac rule, that would require the largest firms to hold a substantial buffer of long-term debt that, in the event that they were to fail, could be bailed in to protect the taxpayers from having to bear any burden in terms of injecting capital into the firms that would provide loss absorption in the event. and working jointly, close with the fdic, firms have made a great deal of progress with their living wills. we're in the process of evaluating the most recent submissions. and working with the fdic, i think pote

an amount of debt and an amount of corporate debt has almost doubled since 2000al and because of dodd-frank. the amount of debt or balance sheet power for brokered dealers has been cut in half and when these things turn they turn violently, and i don't think i don't think anything has changed. dan mentioned the deals out here. what do you think people will do with that new-found cash? >> the only capital to be deployed in the high-yield market is not bank balance sheets. there are real money accounts. there are pensions. >> not even close to -- >> these guys are net buyers. >> not even close. >> and i'm not going to deny that the commodity super cycle won't have more implosions, they will. but that's not what people are buying when they buy stocks. buying the next ten year and i i think you can worry about energy exclusively. >> and for the week oil is up 10%, 9%. and that's certainly helped change sentiment for this week, especially in high yields. >> sentiment is the a huge thing and when you think about all the fears, you know, a lot of fears have abated over the last month since februar

steve: we operate under dodd frank.hole idea and the concept here is to truly deliver a product that can help scale this industry. at a federal level, the banking does not have the ability to end the market place. we've built in a cash management system through one of our strategic partners who is in the business. this giving these participants the ability to truly become good corporate citizens, allowing them to transact with wire, allowing them to send to ach and bring insurance to the industry, bring participants that will provide goods and services to people who have not had the ability to do so. tracy: let's say this exchange has taken off and you have the dirt -- the derivatives contracts. will we see high-frequency trading in weed futures? steve: if you look at the marketplace is opening up -- california will be one of the largest marketplaces in the country. we are at a $5 billion industry. ofwing at the fastest pace any industry in the world right now. california alone can truly triple these numbers. you have t

it is about that i've said before, and we would do it under section nine through tina dodd-frank buts not a clear path to. . there have been difficulties for many years. it is important to proceed correctly, and i hope that we see traction on it this year. but i do not want to create the impression that it is something that will be -- >> so you will not put it in place before you leave? >> i hope there is a proposal this year. erik: the labor partner at this -- labor department will put their own fiduciary standard in place. is it not crazy that they will have to work under two sets of rules saying the same thing? >> coordination is very important, there is no set about that. you see that over the derivatives we need to coordinate with international regulators to be as compatible as we can be. we do not have a typical market spaces, and that is true with a fiduciary duty rule. we are independent agencies, independent statutory today,ibilities and even brokers who are in me dealing with our rules, and they are dealing with the labor department's rules. it is not a new phenomenon that

. >> what dodd-frank was designed to do with the safer and resilience in the next downturn, and never cause a downturn again. the knock on effect is a limited ability for banks to take risk in the market in structured credit. what that means is that when we have these big changes in sentiment, or one big motivated seller, there is no propriety trading desk with enough balance sheet to take that down. extreme pricee leanings than we have seen like we have seen in structured credit. lisa: what about liquidity concerns, and another five that does not have the luxury of long-term capital? >> that is something we take very seriously, because we provide our investors reasonable liquidity. we have intermediate liquidity strategies. equity, we private do not do real estate, but we take things that will take a quarter to liquidate. for us to the only area that is dangerously low on liquidity is massive spreads. are three points off your spread, that should be sufficient. david: thank you for coming in. the next 20 minutes of bloomberg markets, blackstone president tony tan's is next. he says e

the dodd frank law is the second best law he has signed after the health-care bill, i don't care what anybody has told you, it will stop wall street from wrecking main street. there is one hole in it. it was a terrible mistake, a lot of people voted for that bill. honestly they didn't know what they were doing. it was an honest terrible mistake. the other problem is a lot of people are worried about the last war instead of this one. the law clearly says loans to small businesses, to farmers, to entrepreneurs should not be subject to the same kind of rules that $80 billion loans -- $80 billion loans that fuel speculation are. but many plas are doing that. hillary wants to say let's go back to community banking. more than 90% of all the money loaned ever under the law, let's get funds to our small businesses, get funds people. we can do that. we have some barriers. we have plenty of barriers to what she believes is necessary. if we are going to have shared prosperity, we can't do that until every single american has the opportunity to live up to her or his god-given ability. everybody i

successes inr repealing dodd frank rules. he made a few different arguments.e were structural and some were more sensitive. metlife could not see the process, it was not transparent enough. he made an argument that the structure of the financial , onelity oversight council of his arguments was fsoc is not independent enough. we will know more once we see the opinion. where he did get some traction is the fsoc did not properly assess metlife's on our ability. -- vulnerability. david: still ahead, commodity . more "bloomberg markets" after the break. ♪ oh, hi! micky dolenz of the monkees here, getting ready to host the flower power cruise. (announcer) we're taking the love generation to the high seas and reliving the '60s. we'll celebrate that unbelievable era with the music that made it so special. there'll be over 40 live performances featuring eric burdon & the animals, micky dolenz, the monkees lead singer and cruise host, the 5th dimension, the lovin' spoonful, rare earth, spencer davis, three dog night, and many more! imagine enjoying all that great music

why firms are going after regulators, and what it means for the dodd frank act.sk where julie hymen has the latest. happy quarter end. that was a rough quarter.

. >> that fits dodd/frank perfectly. >> generally the criminal law to extinguish ago whole brand unless it clearly says so what is says to the administrators in cahoots with the other agencies in the justice department with the very vague lot of protecting that regulation. >> originally they did not want the banks to risk their reputations and to harm the financial system so part of that is what is the bakes' start lending to the industries that our high risk so they would doubt if they should be regulating but the government through this interpretation there really doesn't have any grounding the week is stop the banks from regulating the industries that have said -- bad reputations as the neck and then the depositor is the bad person. >> but what is troubling is reputation is the standard that gives regulators the freedom to pick and choose who they do not like. to select certain individuals or points of the you almost a purgatorial treatment using the power of the government. >> patel said techniques how do they squeeze those banks to go along? >> added the regulators would prefer the

he says the dodd-frank law made the financial system more secure and did not hurt the economy.g of wall street, the average bonus for my percent last year, according to estimates from comptrollers. was $146,000.onus it's a drop of 6%. that's the bloomberg business flash. "what'd you miss?" junk bonds are getting junkier. oil company debt is far outpacing upgrades. with us still. you wrote about this. why does this matter? ok, it's junk. it seems obvious. tracy: well, i am cohosting, so we have to talk about high-yield. people always talk about the headline numbers in high-yield debt. but people very rarely talk about the actual composition. butave seen a huge rally, what is going on beneath the surface is that we are seeing a lot of companies downgraded, a lot of bbb, b falling into c, which is one notch above default. joe: so two things have been happening simultaneously. we see some improvement in the latest rally, but we are seeing more within that index. more stuff is moving to junk, even as the junk indices have staged a rally. tracy: pretty much. you're also seeing a dive

he said dodd-frank made the financial system more secure and did not hurt the economy. the u.s.as made major strides in reducing its annual deficits in the last six years, but that is about to end. the cbo is now forecasting the budget to grow over the next 10 years, so why is there not much concern in the markets? christopher maloney is here to explain why. buttoo much concern so far, give us the numbers. christopher: if you look right now, as a percentage of gdp, approximately 2.5%. the cbo has said that will increase back to almost 5%. this is not nearly as bad as it was in the dark days of 2011 with 9%. if you look at a graph of the u.s. dollar vis-a-vis a basket of foreign currencies, it's been increasing steadily during that time. it is not so much the fact that budgets have been improving. it is also that we are the reserve currency of the world. that certainly helps. 4.9%, butcking up to not until 2026. at the moment, 2.9%. it doesn't sound too bad to me. this isn't just my opinion. you look at the cbo and treasury. fiscal year 2015 statement, the look ahead, both point