The markets will likely be moved by an expected Senate vote this week on the Dodd financial services reform bill; Summit Business Media sources suggest there will be a cloture vote on May 17–the Senate convenes at 2:00 PM that day–followed by release of the “managers’ amendment” the same day or Tuesday. May 18. A vote is likely on the bill, S.3217, Restoring American Financial Stability Act of 2010, according to Congress Daily, because two other key bills must be passed before Memorial Day–a supplemental spending bill and a tax-extender package.
In two recent speeches, President Obama raised the issue of reform and the economy. In a speech in Buffalo on May 13, Obama spoke of the importance of small businesses to the economy–”government can’t create jobs,” he said, “but it can create the conditions for small businesses to grow and thrive and hire more workers”–and also discussed prospects for tax simplification.
In his weekly radio address on May 15, Obama spoke admiringly of community banks and how financial services reform will benefit those institutions and consumers: “What reform will do is help level the playing field by making sure all our lenders–not just community banks–are subject to tough oversight.”
A post called “The 10 Most Wanted Lobbyist Loopholes on Financial Reform” by Dan Pfeiffer, the White House Communications Director, on May 4 predicting how the “lobbyists” would attempt to shanghai the financial services reform bill is worth a revisit, though there’s no mention of the fiduciary issue.
As the euro fell May 14 to its lowest level since the markets and economic crisis of 2008-2009, there are new fears that the Greek debt contagion will spread to banks throughout Europe. In an interview in Der Spiegel on May 15, the head of the European Central Bank, Jean-Claude Trichet, warned that European markets remained fragile despite the nearly $1 trillion loan package that EU finance ministers wrought last week with the help of the IMF, saying “These big and highly leveraged institutions are a major issue to be addressed at the global level,” and that “We are now experiencing severe tensions.”