15 Sep 2017

DODD-FRANK VS. DONALD TRUMP

Does the leader of the free world really intend to take us back to the pre-crash days?

Ten years on from the biggest financial crash the world has ever seen and many are discussing how the industry has grown and changed since.

Tighter regulation has been at the forefront of these discussions.

The Dodd-Frank Act was enforced into law by Barack Obama in 2010 in response to the 2008 crash.

The regulation is designed to keep bankers on a leash and minimise various risks across the industry to prevent a similar economic meltdown from happening again.

President Trump has pledged that he will repeal Dodd-Frank to relieve tight restrictions and accelerate growth and lending.

Naturally, the claim has been met with plenty of criticism but, more significantly, fear.

Janet Yellen, the Federal Reserve chair, has rebuked the motion. In a speech at the end of August she said:

“The core reforms we have put in place have substantially boosted resilience without unduly limiting credit availability or economic growth.”

Janet continued, “Any adjustment to the regulatory framework should be modest and preserve the increase in resilience” in a financial system she said was now better able to weather future shocks.

Will the Trump-backed Wall Street calls to repeal Dodd-Frank open holes in the US financial system or is it a necessary move for growth? Only time will tell.

Whilst Dodd-Frank is certainly taking centre stage at the moment, MiFID II and RegAT haven’t taken a backseat.

We took a deep dive into the two regulatory proposals earlier this year.

READ MORE ON US REGULATION