Reuters - Video

Edition: US | UK | IN | CN | JP

Washington10

Dodd: Expect an infrastructure bank

Tuesday, September 21, 2010 - 06:39

Sept 21 - U.S. Senator Christopher Dodd, D-Connecticut, looks at countries around the world embracing their own versions of the Dodd-Frank bill, consumer protection and the infrastructure bank plan.

▲ Hide Transcript

View Transcript

can start to talk so it's not just the eyes of the Federal Reserve . But rather collect percent of allies who can look at financial services from different perspectives. That'll be watching a Greece. And Ireland Spain. A product lines here that could pose serious risk to the economy. That's never existed before and you really wanna get rid of that. The idea of having consumer protection -- the root of all of this is consumer confidence. And the idea that you can get protected when you buy a and that you would happily did vote for financial reform. You mentioned consumer protection somebody would argue that the pendulum will space under Elizabeth Warren at no additional swing too -- the other -- going to be some punitive. Restrictions placed on -- well that shouldn't be the case and again the is going to be. The good working relationship. In my view between consumer protection and prudential regulation. And if it's a very hostile environment. And that won't be healthy for the economy. These are not. Inherently I'll never forget the words of Denver and act. In a very monotone voice very quiet voice he said the following. If you was speaking to the leadership of congress Democrats and Republicans don't act within I don't know how -- do this if you wanted to light rail systems and you wanna maintain year. Water and sewage systems and increase here highway capacity. Where appropriate you've got to have a resource The reasons don't -- fire it will street reforms that the American financial industry largely intact. But facing a more powerful set of regulators adding new place limits on risky activities. Since it Christopher dog now joins us from Washington as congress was Summitt Tennessee thanks very much like it and -- He Tilton in the when you're talking then it -- in the summit that you didn't think it was a crazy bill -- of frank abilities that other countries looking at it and coping elements of it. How fundamentally you think it's gonna change the landscape -- banks is it gonna. Undermined. The way they do business is it going to change that profits of -- right. It may be some change in profits mean some of the things we did a proprietary trading so with a capital requirements and so forth. And Europe that the the world is not all like Europe does a lot of its economic growth and development out of its banks we do most of -- out of investment banks to venture capital so we have a difference and that. But nonetheless I I think again that the idea of having. Having a floor on capital requirements the quality of capital that may reduce some profits it's gonna get some certainty and stability. Which is critically important for long term economic growth and stability and opportunity -- I I again we don't overstate the case -- but the reaction to the bill. Has been pretty strong -- and the best compliment the -- received. Is that it in places like the European Union is taking almost like the derivatives section. I would say verbatim but very close they're setting up this systemic risk council much as we have in this -- that a lot of duplication a lot of very positive reactions to it and it was -- what this bill was not designed to fix the current economic problems. It was to give us the opportunity respond to the next crisis would certainly will come. And you and I don't know where that bubbles gonna come from but I -- as I'm sitting here it will happen. But we hope the next time we built in the tools that will minimize that crisis from having. And in the past to sizing effective contaminating the rest of the economy both at home and abroad globally so. The various provisions in this bill designed specifically to do that. To the financial services sector. -- some Republicans would like to repeal the whole thing code gave it. But counting so you know I do think they would do we have to chip away at enemy -- which you know look what do what do we don't have to big to fail I mean this is and that's a major part of the -- So your major financial institution the days are over with the federal government is gonna put adjustments on the fire over with -- anyone wanna go back to that you know. The idea that you can have a systemic risk council -- they can start to talk so it's not just the eyes of the Federal Reserve . But rather collect percent of allies who can look at financial services from different perspectives. That'll be watching a Greece. And Ireland Spain. A product lines here that could pose serious risk to the economy. That's never existed before and you really wanna get rid of that. The idea of having consumer protection -- the root of all of this is consumer confidence. And the idea that you can get protected when you buy a faulty commercial product and automobile a toaster television. But you get no protection when you buy a mortgage. But take livestock and I'm talking about guaranteeing. Get a return on your investment but that the system is parents and and so again there's a lot of this talk on and doing all of this that the best evidence I have that that won't occur. Is I don't hear anybody in this campaign talking about getting rid of financial reform. In fact quite the opposite. The -- recent polling has indicated that if you wanna get elected or reelected this year -- deficit reduction and that you would happily did vote for financial reform. You mentioned consumer protection somebody would argue that the pendulum will space under Elizabeth Warren at no additional swing too -- the other -- going to be some punitive. Restrictions placed on -- well that shouldn't be the case and again the is going to be. The good working relationship. In my view between consumer protection and prudential regulation. And if it's a very hostile environment. And that won't be healthy for the economy. These are not. Inherently conflict of ideas they ought to be complimentary for the most part. And so I have a lot of respect for Elizabeth. She's now gonna be a senior adviser and all of this the administration has told me that they'll be nominating a director that must be confirmed by the senate. Probably after the old mid term elections before the nominee will come up and my hope is that mid term. A lame duck session we can actually bring someone up and maybe have him confirmed before we adjourn for the year. And that's the case then all next year they'll be setting this operation up and I know they'll be those who try and pick away -- it may be some degree. But I think they do so -- their political Carol the company does not want us to go back to where we were in the fall of 2008 I sat in that room. With -- eleven other members of congress when Ben Bernanke and Hank Paulson walked and as long as I live Simon I'll never forget the words of Denver and act. In a very monotone voice very quiet voice he said the following. If you was speaking to the leadership of congress Democrats and Republicans don't act within a matter of days the entire financial system in this country and good part of the world will melt down. Now you know and and that began this whole series of events. That led the passage of -- legislation. None of us ever wanna be in the position we were on the night of September 18 2008. So Republicans and others can talk like chipping away at this. You do so much apparel I think in the in the eyes of the American pop. Final vote on the infrastructure back price on the united you've been here became known for awhile to think that finally may happen it may mean before that these elections and I think that's I think it has to happen. I don't know how -- do this if you wanted to light rail systems and you wanna maintain year. Water and sewage systems and increase here highway capacity. Where appropriate you've got to have a resource capacity to do -- cannot be done out of the appropriation crosses in my view alone. It's gonna have to be done otherwise in this bonding that that is to do this but also and polls could be used to some degree. But attracting private capital other countries have done this very successfully. But that sovereign wealth funds debenture private equity. Do love to invest in this are good investments are solid there's no danger of a sovereign wealth fund packing up the light rail system and moving it back. To some foreign nation again so that that kind of investment is. It ought to be ought to be welcomed in this country and my view is that the administration others I think -- coming around to that conclusion. And you write when I'm gonna do in the next few weeks but I have a feeling it'll pass sometime next year so Douglas we have time with -- much thank you for joining us today enjoy it says Christopher Abdullah. This is I'm symington. Supports.

Press CTRL+C (Windows), CMD+C (Mac), or long-press the URL below on your mobile device to copy the code

Dodd: Expect an infrastructure bank

Tuesday, September 21, 2010 - 06:39