Archive for Monday, November 17, 2008

Financial overhaul added to Obama’s to-do list

November 17, 2008


— Barack Obama isn't president yet, but his must-do list just got longer.

The newest addition to the lengthy list of tasks after taking office: helping oversee the overhaul of the world's financial regulatory system. That is one of the assignments to the president-elect from current global leaders after their weekend summit, where they pledged action to avoid a repeat of the financial mess that has caused worldwide economic chaos.

"Obama has a tall order," said Morris Goldstein, a senior fellow at the Peterson Institute for International Economics who spent years working at the International Monetary Fund, the world's financial firefighter.

"He has a lot of things he has to do quickly in a number of areas and doesn't have a lot of time to think about them," Goldstein said in an interview Sunday.

That will put a lot of pressure on Obama. He did not participate in the emergency two-day summit that concluded Saturday, instead sending representatives to meet with leaders on the sidelines.

After taking the oath of office Jan. 20, Obama will have to figure out in short order how far his administration is willing to go in revamping oversight of financial companies and products, in the United States and abroad, and nailing down the crucial details.

"Obama has an incredible mountain to climb in the way of the economic and financial situation," said Richard Yamarone, economist at Argus Research.

President George W. Bush hosted the summit, where nearly two dozen foreign leaders endorsed broad goals to fend off any future calamities and to revive the global economy.

It will be up to finance ministers to flesh out the details to put such changes in place by the end of March. Leaders plan to hold the next summit by April 30 - just months into Obama's term.

"I think this puts Obama and a new administration in a very difficult position," said Steven Schrage, a former Bush administration trade official now at the Center for Strategic and International Studies.

"It's really going to be up to the next administration to figure, do they breathe life into this? Does this go forward? Do they take it in a different direction?"

All the while, the new president will be under immense pressure to bring relief to millions of Americans who have watched jobs disappear, nest eggs shrink, home values plunge, foreclosures zoom upward and banks - along with storied Wall Street firms - laid low by the financial and economic crises.

"Make no mistake: This is the greatest economic challenge of our times," Obama said Saturday in the weekly Democratic radio address. "And while the road ahead will be long and the work will be hard, I know that we can steer ourselves out of this crisis."

The president-elect himself did not weigh in after the summit about whether he agreed with the thrust of the leaders' broad goals. But he indicated the global gathering was a good idea because "our global economic crisis requires a coordinated global response," he said Saturday.

Translating the leaders' sweeping principles into specific actions will be difficult. "That's the rub. That's where you really see the differences across countries in what you want to do," Goldstein said. "In the coming months, we'll see to what extent Obama's agenda will conflict with the Europeans."

Leaders pledged to make the global financial system more accountable to investors and less vulnerable to risky investing.


Richard Heckler 9 years, 6 months ago

Treasury Department apparently kept no records or does not want to tell anyone. Names and collateral are not readily available.With his latest policy switch to buying stock in banks and other companies, Henry Paulson has more zigs and zags to his credit than a fox trying to escape a pack of hounds. The fox and the hounds, of course, have a clear idea of what they want to do and how they want to do it, which is more than you can say of Paulson. Sums of incalculable size are being spent or pledged by Paulson and his playmate, Ben Bernanke, chairman of the Federal Reserve Board, and nobody outside their organizations, or maybe inside them either, knows who got what, how much they got, and under what conditions they got it. In the past couple of months Bernanke has loaned out $2 trillion to unnamed companies under eleven different programs and all but three of them were slapped together in the past fifteen months of financial crisis. To repeat, we do not know who got this money or what collateral was put up in return for the loans or what conditions were attached to them.

Maddy Griffin 9 years, 6 months ago

I just read this morning that the top 7 people at Goldman Sachs refused thie annual bonuses.If your company almost goes belly up, should you get any bonus??And the top guy makes $600,00 and got a $68 billion bonus last year.Does anyone here make more on their bonus than they do on regular salary?! I think I'm seeing why there's such chaos. STOP THE BONUSES!!!!!!!!!!!!!

jmadison 9 years, 6 months ago

Is he going to get rid of Sen Chris Dodd and Cong. Barney Frank who are at the root cause of the financial meltdown due to their obstinate opposition to any financial oversight of Fannie Mae and Freddie Mac? The outmoded seniority system in Congress makes the argument for term limits to get these sclerotic individuals out of power.

just_another_bozo_on_this_bus 9 years, 6 months ago

"Paying off the people who bought the White House for him without being too obvious is high on the O'dude's to-do list."If so, he should be taking notes on BushCo's last days in office-- except that they aren't trying to conceal it very hard.

Flap Doodle 9 years, 6 months ago

Paying off the people who bought the White House for him without being too obvious is high on the O'dude's to-do list.

Siouxhawker 9 years, 6 months ago

Oh FYI, that was for. Mr. Shewmon's comment.Mr. Shewmon check out what my Governor had to say about the recount process.

Siouxhawker 9 years, 6 months ago

How dare you call Minnesota's recount process corrupt! Have you never read an article about Minnesota politics? Its one of the most transparent open processes in the United States.There was a Supreme Court primary recount in September that went mighty smoothly. That's what us, pragmatic Scandanavians are all about. The intent of the recount is to measure the 'undervote' or intent of the voter. It suggests there may be up to 25,000 with a majority of such votes cast in Hennepin, Ramsey, and St. Louis. The locations of Minneapolis, St. Paul, and Duluth respectively.As for the additional votes by Franken, there was less movement than in 2006 in Klobuchar v. Kennedy. The votes Franken gained were attributed to a misfire in the computer from precinct to the secretary of state office. They audited it and got it right upon review. It's what states are suppose to do.Don't listen to the propaganda machines of Sean Hannity and Rush Limbaugh. FYI, I am a student at KU thus, have vested interests KU politics and news.

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