“Any plan to further reform our financial system must include strong
provisions to tackle risks in the ‘shadow banking’ sector, which
remains a critical source of instability in our economy,” Gensler said.
Top Clinton aide blasts Sanders' Wall Street proposals(Reuters)
A top aide to Democratic presidential front-runner Hillary Clinton on Monday criticized rival Bernie Sanders’ proposals to regulate Wall Street as doing nothing to address some of the riskiest financial institutions.
Sanders,
who is Clinton’s chief challenger for the Democratic nomination for the
November 2016 election, will deliver what his campaign is calling a “major policy address” on Wall Street reform in New York on Tuesday.
Clinton’s chief financial officer, Gary Gensler, a former chair of the Commodity Futures Trading Commission, said in a statement that Sanders should “go beyond his existing plans” to break up too-big-to-fail banks and endorse a risk-based approach that also deals with non-bank financial institutions.
“Any
plan to further reform our financial system must include strong
provisions to tackle risks in the ‘shadow banking’ sector, which remains
a critical source of instability in our economy,” Gensler said.
“This
includes certain activities of hedge funds, investment banks like the
now-defunct Lehman Brothers, and insurance companies like AIG,” Gensler added, calling them some of the “biggest culprits” of the 2008 financial crisis.
"Senator
Sanders won’t be taking advice on how to regulate Wall Street from a
former Goldman Sachs partner and a former Treasury Department official
who helped Wall Street rig the system," Sanders campaign spokesman Michael Briggs said, referring to Gensler's past positions.
Sanders,
a democratic socialist and independent U.S. senator from Vermont who is
popular with the Democratic Party’s populist wing, has made reining in
Wall Street abuses and reducing income inequality his signature campaign
issues.
He favors reinstating the Glass-Steagall
law passed during the Depression, which prohibited commercial banks from
engaging in investment banking activities. He also supports breaking up
“too-big-to-fail” banks.
Clinton believes that
reinstating Glass-Steagall, whose main provisions were repealed in 1999
during the presidency of her husband, Bill Clinton,
would not address the types of institutions that have cropped up since
the law was written in the 1930s. She has endorsed an approach that
would break up large banks that take excessive risk.
Clinton
has said she would target the shadow-banking system by imposing limits
on risky short-term borrowing, reviewing recent regulatory changes to
the money market industry and enacting new reporting requirements for
hedge funds and private equity firms.
Clinton and
Sanders have sparred over how best to curb the risky behavior that
caused the 2008 crisis, leading to some of the most contentious
exchanges in their party's presidential debates.
إرسال تعليق