For over a year, Donald Trump repeatedly stated that his vast wealth made him immune to outside influence and warned against the power of a particular Wall Street firm.
During his campaign, Trump sharply criticized Democratic presidential nominee Hillary Clinton for not releasing transcripts of speeches she gave to Goldman Sachs and other Wall Street banks. He also accused Clinton and former Republican presidential candidate Sen. Ted Cruz of being controlled by Goldman Sachs.
But now that Trump has installed Goldman Sachs alumni in every corner of the White House, it’s time for him to show his independence by … rolling over with his belly to the sky.
President Donald Trump on Friday plans to sign an executive action to scale back the 2010 Dodd-Frank financial-overhaul law, in a sweeping plan to dismantle much of the regulatory system put in place after the financial crisis.
What could be more reassuring than the phrase “dismantle much of the regulatory system put in place after the financial crisis”? After all, it’s not as if those regulations were put there exactly to keep the crisis from happening again. But wait. It gets better.
Gary Cohn, White House Economic Council director, told the Wall Street Journal in an interview published last night that the administration would also move against a regulation designed to force retirement advisers to work in the best interest of their clients, the “fiduciary rule,” set to take effect in April and designed to eliminate conflicts-of-interest among professionals dealing with those enrolled in qualified retirement plans and IRAs.
Donald Trump is going to make sure that Wall Street can keep lying to clients and feeding off retirees—because that’s what makes America great.
The fiduciary rule, which hasn’t yet gone into effect, was intended to make sure that financial advisers were actually giving their best advice. That’s because giving bad advice can be very good for unscrupulous advisers who milk their clients by making hundreds of unnecessary trades and pocketing the fees, or pushing clients into high-cost funds from which the adviser gets a kick back.
The basic idea was to make sure that when people were investing in retirement funds, the experts they paid to advise them and manage those funds were actually working for the people who were supposed to be their clients, rather than fattening themselves at their client’s expense. Naturally, Wall Street hated this rule.
They also hate the way that Dodd-Frank limits the types of investments in which banks can indulge, and the way it limits their risk by the actual amount of funds they have on hand.
The Dodd-Frank Act, hated by Wall Street and Republican members of Congress, was enacted in the wake of the financial crisis of 2008 that brought on the Great Recession and during the presidential campaign was described derisively by many Republican leaders as “Obamacare for banks.”
Donald Trump is doing absolutely everything in his power to make his administration the second coming of Hoover and W rolled together.
Make it possible for banks to engage in dangerous, unlimited speculation and create new “instruments” such as the Credit Default Swaps that left behind debt that exceeded the global GDP? Check.
Destroy regulations meant to help retirees, leaving them unprotected from predatory “advisers” who funnel retirement savings into their own pockets? Check, check.
Create an uncertain trade environment devoid of stability and filled with shifting, one on one agreements that send the value of the dollar swaying out of control? Check, check, check.
Eight years of growth. It was a pretty good run.