Regular readers of Financial Regulation Matters (and, in truth, any financially-concerned writing) will be more than aware that President Trump has his sights set firmly on the Dodd-Frank Act’s destruction; in fact, he is unequivocal in his aims to remove regulations that ‘ enshrine too big to fail and encourage risky behaviour ’. Yet, his planned dismantling, like almost every other ‘huge’ plan that he declared on his way to the White House, has not come to fruition and the new strategy is, seemingly, based upon a piecemeal approach and taking victories whenever one presents itself; recently, with certain actions taken at a Government agency created by the Dodd-Frank Act, Trump sensed a victory and acted. Yet, things have not gone smoothly and in this post we will assess the development of this story and some of the implications. It has been suggested on numerous occasions that the roadblocks that have been erected in Trump’s remarkable path will force his Administration to th...

Today’s post reacts to the news that the Financial Stability Oversight Council (FSOC) has removed AIG’s designation as a ‘Systemically Important Financial Institution’ (SIFI), which has the effect of lessening the regulation of the massive insurer that was at the heart of the Financial Crisis. In this post, the focus will be on that decision and how it plays into a growing deregulatory movement which is gaining strength all the time although, as we shall see, this ‘amnesia’ that is taking hold is based upon particularly short-sighted and overly-politicised ‘point-scoring’ which puts the very fragile financial system in great peril. It was announced on Friday that, technically, the giant insurer American International Group, more commonly known as AIG, is no longer ‘too big to fail’. The insurer, who at the height of the crisis was afforded an $85 billion bailout , was on Friday taken off the ‘systemically important financial institution’ list which conveys a number of increased ...

This week in the world of business has been dominated by massive trade deals and bitter trade disputes, with this post suggesting that a link between the two is that the outcome of these developments portrays a vision for those British voters who voted to leave the E.U. of what post-Brexit Britain will look like. In what is proving to be a great advert for the E.U. and its members not following the path of the British (a message sharply delivered by the French and German electorate this year, despite the rise of the AfD ), the plight of Canadian company Bombardier is, for a variety of reasons, bringing the reality home to the British in a remarkable way. In this post then the focus will be on the ongoing trade dispute between Bombardier and Boeing, which is quickly elevating into a political catastrophe, and the merger of French company Alstom with its German Counterpart Siemens (leaving Bombardier in the cold), which in itself demonstrates the capability that exists within a co...

Earlier this year here in Financial Regulation Matters , we took a look at the confirmation of Steven Mnuchin as Treasury Secretary in the U.S. from within the concept of ‘Government Sachs’, which is a phrase that has been adopted to describe the continuous presence of former and prospective Goldman Sachs employees within the top offices of the United States political framework. The previous post focused on Mnuchin as he ascended to one of the most crucial jobs within the American political framework, but in this post the progression of Gary Cohn, who sits as the Director of the National Economic Council (NEC), will be the focus. Whilst the existence of ‘Government Sachs’ will not be questioned because, quite frankly, it cannot be questioned, assessing the effect that Cohn is having is an important endeavour because, as is generally accepted, these are currently quite extraordinary times. We saw in the last post on ‘Government Sachs’ that Goldman’s stranglehold on these socie...

Usually here in Financial Regulation Matters , the focus of posts is on the world of business and usually its connection with the world around it – business, rather obviously, is part of a much larger societal picture, particularly in this modern era. The focus of the posts is usually upon business and/or regulatory developments, which are then assessed against a broader backdrop. However, today’s post represents a slight departure from that approach in that it responds to the recent wave of headlines praising corporations for taking a stand against the developing situation in the United States regarding President Trump and his views towards outwardly racist groups. For this post there is only one question that is of concern, and that is whether the praise being showered upon companies like Apple, Spotify, and Go Daddy is correct. The first wave of public, and specifically media praise for companies began after a number of CEO’s left the President’s advisory councils . Before th...

On quite a few occasions here in Financial Regulation Matters we have focused on the growing credit bubble and its potential effects when it collapses. In today’s post, we are going to continue this assessment by looking specifically at the situation in the United States, which will encompass an array of reports and studies that discuss an ever-growing problem that is beginning to set records. As we often do in Financial Regulation Matters , we will position this discussion within a much wider context and discuss how the proximity of this bubble to the last Crisis is particularly worrying, but also we will look at how impotent the system is at actually constraining it, with the result being methodologies that are moving into absurd territories. We have discussed the rising credit problem on a number of occasions before, but mostly in terms of the warnings posed by British regulators . However, looking at the global picture reveals a much more dangerous situation in that the wo...

Today’s post takes a look at the forthcoming trip of Britain’s International Trade Secretary, Liam Fox, to the United States to begin talks about a possible trade deal between the two countries. In the media on both sides of the Atlantic, but particularly in the U.K., there is a real concern about the effects that such a trade deal could generate, with an imbalance between British and American corporations being top of that agenda. So, in this post, we will assess these claims and examine whether a trade deal is being pursued for the right reasons, or whether the pre-Brexit environment is already becoming illustrative of life outside of the European Union for the British. Speaking in July, President Trump said he expects a ‘powerful’ trade deal to be conducted with the U.K. ‘ very quickly ’, and it is on the back of these statements that Liam Fox has travelled to Washington, D.C. The talks themselves, which the head of the TUC – Frances O’Grady - suggests is a ‘ PR stunt ’ for F...

Today’s post looks at the news that Goldman Sachs’ Chief Executive Officer, Lloyd Blankfein, has issued his very first personal ‘tweet’ - which has a certain reverence given that he joined the social media platform in 2011 - to condemn President Trump’s decision to leave the Paris Agreement on Climate Change and Environmental issues. In this post we shall look more closely at the sentiments offered by Blankfein and the reasons for it, but in keeping with the sentiments applied here in Financial Regulation Matters , we shall then look at the larger picture where will find that Blankfein’s condemnation is ironic at best, and appalling at worst. Only a few days ago, President Trump stood outside the White House and declared that, with regard to America’s participation in the Paris Climate Accord, ‘ we’re getting out ’ which, obviously, led to a wave of criticism and counter-statements from around the world . The decision will no doubt continue to be the focus of much debate, but f...

Today’s post reacts to the news that US President, Donald Trump, has yesterday hinted at establishing a ‘Glass-Steagall’-type piece of banking legislation. The ‘Glass-Steagall’ Act, more formally known as four specific components of the U.S. Banking Act of 1933 , was established to separate the commercial and investment arms of US banks as part of the ‘ New Deal ’ era that defined President Franklin D. Roosevelt’s first term in office. For this post, the focus will be on the actualities of President Trump’s intimation, based against the backdrop of his other actions, and then ultimately the focus will be upon the larger implications of choosing to follow this pathway, and indeed the implications of doing the opposite. Speaking to Bloomberg news, Trump declared on Monday that, with regards to reintroducing a Glass-Steagall-type Act, he was ‘ looking at that right now’ and that ‘there’s some people that want to go back to the old system, right? So we’re going to look at that’ . Be...

Today’s post reacts to the news that President Trump is seeking to ‘ cut corporate tax to 15% ’ from the current rate of 35%. The proposal, which was announced this week, represents what White House officials are labelling as the ‘ largest tax reform in US history ’ and which has its basis in the (supposed) aim of repatriating taxes on money that major US companies like Apple, Google, and Microsoft generate abroad. For this post the focus will be on the larger picture; specifically, the focus will be on the connection between this story and the fears that Brexit will promote the idea that Britain will set itself up as a tax-haven if it is shut out of the single market. The two developments, potentially, point to a much larger issue that has been mentioned time and time again here in Financial Regulation Matters – the escalation in divisiveness within modern politics is playing right into the hands of big business. The plans to cut the US Corporate Tax rate by a massive 20% have...