Dems cave in on derivatives regulation

[rfranklin]

Marketwatch quotes the WSJ as saying that the Dems removed the derivatives regulation from the bill.

[Skink]

1. we're all doomed.

[harry_pothead]

2. Wow, great, that's awesome.

Yet this clown of a party wants my time and donations...

[Captain Hilts]

3. Mark Halperin wrote his article a day too soon. It would be even more positive now. nt

[ixion]

4. "Dems cave in on" { Insert Topic here }

sad, and all too typical. :argh:

[laughingliberal]

11. +1 nt

[babylonsister]

5. wsj? WaPo says otherwise: Top Senate Democrats near derivatives deal: sources

:shrug:

Top Senate Democrats near derivatives deal: sources

By Roberta Rampton and Rachelle Younglai
Reuters
Monday, April 26, 2010; 9:22 AM


WASHINGTON (Reuters) - The two Democratic Senators charged with writing rules for the $450 trillion private swaps market are near a deal, and will include a provision to require banks to spin off swaps desks, people familiar with the talks said on Sunday.

One source said the U.S. Treasury Department is raising concerns over the restrictions as Senate Banking Chairman Christopher Dodd and Senate Agriculture Chairman Blanche Lincoln try to hash out how best to clamp down on derivatives, blamed in part for accelerating the recent financial crisis.

The Senate votes on Monday on whether to start debating Democrats' bill to impose strict rules for banks, capital markets and derivatives -- one of the most contentious parts of the proposed legislation.


more...

http://www.washingtonpost.com/wp-dyn/content/article/2010/04/26/AR2010042601161.html

[Bigmack]

6. I just posted on another thread....

"I just hope the Dems roll over quickly...

and don't let their embarrassment drag on and on like with health care.

Surrender is sooo much better than fighting for anything!"

Looks like they rolled over!

Jayzus!

[sharp_stick]

17. Perhaps

reading the story before jamming the knife in your belly would be a good idea?

[Writer]

7. Dude, the WSJ is now owned by Murdoch. Be prudent. n/t

[Deep13]

8. I don't see anything on their website that supports what you wrote.

Could you point out the exact quote?

[rfranklin]

12. It's at the top of the Marketwatch page...

http://www.marketwatch.com/

[Jennicut]

9. That is false info. The deal to aid Warren Buffet's company was stripped out.

Mr. Buffett’s company, Berkshire Hathaway, has been lobbying for changes to the overhaul that would prevent his finances from being overly impacted by the bill, The Journal said.

Berkshire would like a provision to the bill ensuring that existing derivative contracts would not be affected by the proposed rules. Berkshire has $63 billion worth of derivatives on its books, according to Barclays Capital, The Journal reported.

The deal is expected to be incorporated into broader Democratic proposals set to alter the U.S. system of financial regulation, which, according to The Journal, reflect “the populist, anti-bank sentiments simmering on Capitol Hill.”

Whether Berkshire’s efforts to affect the deal will come to anything is not certain. On Sunday night, Senate officials said most of the details had yet to be finalized.http://dealbook.blogs.nytimes.com/2010/04/26/buffett-wants-grandfather-clause-for-derivatives/


WSJ posted it was taken out. "Senate Democrats agree to strip out derivatives provision pushed by Warren Buffett that would have aided Berkshire Hathaway." http://online.wsj.com/home-page

[Are_grits_groceries]

10. This is the provision they supposedly caved on according to the WSJ:

<snip>
The provision, sought by Berkshire and pushed by Nebraska Sen. Ben Nelson in the Senate Agriculture Committee, would largely exempt existing derivatives contracts from the proposed rules. Previously, the legislation could have allowed regulators to require that companies such as Nebraska-based Berkshire put aside large sums to cover potential losses. The change thus would aid Berkshire, which has a $63 billion derivatives portfolio, according to Barclays Capital.
<snip>
http://online.wsj.com/article/SB10001424052748703441404575206252252365076.html?mod=WSJ_hpp_LEFTTopStories

[rfranklin]

13. Why should Buffet get special treatment?

He is also a big Goldman Sachs supporter.

[Jennicut]

14. They are taking the provision out.

BY DAMIAN PALETTA

WASHINGTON—Senate Democrats agreed Monday to kill a provision from their derivatives bill pushed by Berkshire Hathaway that would have allowed the company to avoid a significant financial hit, people familiar with the matter said.

Sen. Ben Nelson (D., Neb.) initially helped push the provision into a bill passed by the Senate Agriculture Committee last week.

http://online.wsj.com/article/SB10001424052748703465204575208030785525128.html

I don't have access to the rest of the article. I don't subscibe to the WSJ.

It is a GOOD thing. Buffett wanted special treatment.

[sharp_stick]

16. Read the damned story

they are taking the provision out.

You seemed to think it was an important enough thing to post, perhaps reading it before trying to be the first to hit the post button would be useful in the future

[backscatter712]

21. Sounds like the rest of the Dems didn't want a repeat of the Cornhusker Kickback fiasco.

Good on them for taking this out.

[LiberalAndProud]

24. From your link.

The White House has been trying to kill the Berkshire provision on the grounds that it would weaken the government's ability to regulate the enormous market for derivatives. Berkshire Hathaway argued that it shouldn't be made to redo existing contracts and that it is already healthy enough to cover its obligations. The battle over the provision shows how lobbying by businesses and lawmakers to insert just a few words into a complex bill can have a major impact on the country's biggest companies.

And also ...

Analysts say Berkshire may deserve an exemption. In the financial crisis, the company's strength allowed it to invest in shaky firms such as Goldman Sachs, bolstering the financial system. The new regulations would punish Berkshire for the bad behavior of others, they say. "Claiming Berkshire poses a risk to the financial system is a difficult case to make," says Morningstar analyst Bill Bergman.

So Berkshire invested in Goldman Sachs. And that is supposed to recommend them for excemption?

well, anyay, I don't see where the Dems are said to cave in the linked article. Did I miss it?

[BurtWorm]

28. That Ben Nelson is a winner, isn't he ?

:eyes:

[sharp_stick]

15. That is likely an incorrect header

and a massive jump to the wrong conclusion.

The deal IIRC was to aid Berkshire Hathaway, it was pushed by Buffet and uberdick Ben Nelson and it has been stripped out of the provision.

The massive bitch and moan fest is kind of humorous, I always thought reading was a strong suit around here, guess I was wrong.

[tjwash]

18. LOL....I was thinking the same thing

nt

[LiberalAndProud]

19. Do you have any links?

I googled marketwatch diritives and found a fascinating article. Nothing about the Dems capitulating.

And just yesterday I read the diritives reform was the safest bet.

It's not that I question your honesty, just doubt the report of the report.

[DainBramaged]

20. The Wall Street Journal. Doesn't the title leave you suspect?

They are manipulating the market right this second for one of their friends. You'll see. The market will spike, and then retreat when the actual announcement is made.


Someone is betting that it isn't true now that the people who bet it is true are probably collecting.

[rfranklin]

22. My mistake...I read the flash headline and assumed the worst...

Oh well, at least everyone got their pulses up for a few minutes.

[Enrique]

32. not too late to edit it n/t

[Froward69]

23. unreccers = pathetic

:kick:

[ieoeja]

25. See post #10. They removed an "exception" to the derivatives reform!

So they are actually STRENGTHENING the reform instead of eliminating it! Given that the OP is exactly 100% wrong, wouldn't you say unreccing makes sense?

[high density]

27. It's unrecced because the OP is wrong.

They did not "remove derivatives legislation from the bill." They removed a grandfather clause that would have exempted current derivatives on the books from needing to be backed by collateral. And the OP's title is wrong as well, because this isn't a "cave," it's making the law stronger.

[ieoeja]

26. Can you correct your post? Or is it too late?

Given that what they are removing is an EXCEPTION to the reform, which means they are actually STRENGTHENING reform, not removing it, you should probably correct your OP.

[kentuck]

29. Maybe the WSJ is only projecting their wishes...

I have seen this nowhere else??

[florida08]

30. well that was a wild roller coaster

I went from :mad: ----------> :applause: in about 10 secs. I have a headache now

[Enrique]

31. OP appears to be wrong

should be corrected.

The story seems to be exactly the opposite of what this OP says.