way to reduce risk-taking, an administration official said.
Obama will announce the rules today after meeting with former Federal Reserve Chairman Paul Volcker at the White House.
The proposals will be part of an overhaul of regulations and will specifically address firms ’ proprietary trading, the official said
yesterday on the condition of anonymity.
Obama is renewing his focus on economic issues in an effort to tap into voter anger about the struggling economy, taxpayer
bailouts and growing bank profits at a time of 10 percent unemployment and a federal deficit that rose to $1.4 trillion last year.
The proposals could affect trading at some of the nation’s largest banks, including New York-based Goldman Sachs Group
Inc. , Morgan Stanley and JPMorgan Chase & Co ., said Frederic Dickson , chief market strategist at D.A. Davidson & Co. in
Lake Oswego, Oregon. Banks conduct proprietary trading for their own benefit, not for that of their clients.
“It is an obvious target,” Dickson said. “It has been a highly profitable business for those firms that have superior platforms.
Whatever the details of the restrictions, it will draw Wall Street’s attention.”
Obama in June proposed an overhaul of U.S. financial regulations to fix lapses in oversight and excessive risk-taking that
helped push the economy into a prolonged recession.
(Nicholas Johnston and Julianna Goldma/bbg)
