Obama wants Depression Era-style federal bank limits
WASHINGTON (AP) – Embracing Depression-era policy and populist politics, a combative President Barack Obama chastised big Wall Street banks Thursday and urgently called for limits on their size and investments to stave off a new economic meltdown.
Investors responded by dumping bank stock.
Obama’s rhetoric covered the whole financial industry, but the key changes will affect only a few high-profile players, including JPMorgan Chase & Co., while sparing investment banks like Goldman Sachs Group Inc. The move could undercut Treasury Secretary Timothy Geithner’s strategy of maintaining close ties with the financial industry as part of the administration’s overhaul efforts.
“We have to get this done,” Obama said at the White House. “If these folks want a fight, it’s a fight I’m ready to have.”
“We’ve come through a terrible crisis,” the president said, pivoting the White House focus from health care to an economy that has been slow to recover during his first year in office. “The American people have paid a very high price. … That’s why we’re going to rein in the excess and abuse that nearly brought down our financial system.”