Michael Bloomberg did an impressive job of praising Barack Obama while outlining, in detail, what he doesn’t like about Obama’s financial regulatory proposals.
Bloomberg said he opposed restricting banks from engaging in “propriety trading,” and didn’t want to see the president directly appoint the head of the New York Federal Reserve.
The mayor’s main point was that he thinks transparency, not burdonesome regulation, was needed.
From Bloomberg’s statement:
It’s critically important that we don’t prohibit companies for employing the most modern and creative techniques for growing our economy and our housing supply. An open public exchange would enhance America’s competitiveness in the market and bring more jobs here from London and Tokyo and around the world.
But some steps being discussed in Washington would move us backward. Making the President of the New York Federal Reserve a presidential appointee, rather than an appointee of the Fed’s board of governors, would politicize the job. And the last thing that we need at the New York Fed is partisan politics. And requiring entrepreneurs and early-stage businesses to file reports with the SEC that would impose compliance costs that would make it harder for them to succeed, stifling innovation and costing us jobs is not a great idea.
“Other proposals would also lead to job losses. Limiting the size of financial firms would lead companies to move jobs overseas. We already have anti-trust laws that deal with companies that may grow too powerful in the marketplace – and where applicable, those laws should be enforced. They are not always done so now.
“We need American regulations to be coordinated with international standards, or else foreign firms will find it too costly and too difficult to do business here, and our jobs will move overseas.
“Another regulation that would drive business overseas is the proposal to prohibit firms from engaging in proprietary trading. Banning it would not stop it, but only send those jobs to London or Geneva or Shanghai. Proprietary trading is one of the many profit centers that financial institutions use to make money, and they depend on those profits to carry them through unprofitable periods in the loan business. We all depend on access to loans to build houses and schools and hospitals and all businesses – small and large. Every industry needs access to capital – that’s the basis of our entire economy. If we limit banks’ ability to make money, we reduce the amount of lending they can do – and that will hurt all of us.