Despite campaigning to the contrary, President Trump is scheduled to sign an executive order on Friday to roll back banking and advisory provisions adopted after the financial crisis.
The president will begin dismantling the 2010 Dodd/Frank rules, which put too much restraints on the Wall Street banking industry says White House National Economic Council Director Gary Cohn told the Wall Street Journal.
Trump told voters on the campaign that Wall Street did nothing to help them during the crisis and were tone-deaf to their plight as they foreclosed on their homes. The signing today could lead to more of the same as capital controls and fiduciary responsibilities are cut back.
Cohen, the former vice chair of Goldman Sachs, said of the measure, “It has nothing to do with Goldman Sachs. It has nothing to do with JPMorgan. It has nothing to do with Citigroup. It has nothing to do with Bank of America. It has to do with being a player in a global market where we should, could and will have a dominant position as long as we don’t regulate ourselves out of that.”
In what is expected to be a separate executive order, the President will instruct the Labor Department not to enact an upcoming rule requiring financial advisers to avoid conflicts and to work in the best interests of the client.
This rule, scheduled to go in effect in April, would prohibit financial advisers from putting clients in their company’s products for a retirement fund if there were better alternatives in the market.
This rule would have had profound effects on the $3 trillion of retirement assets currently under management in the U.S. The Trump administration said the rule would limit choice for the consumer.
Cohen, who is the ranking financial chief in the White House since the Senate has yet to confirm Treasury chief Steve Mnuchin, also told the Journal: “I’m not sitting here saying we want to go back to the good old days.”
“We have the best, most highly capitalized banks in the world, and we should use that to our competitive advantage,” he added. “But on the flip side, we also have the most highly regulated, overburdened banks in the world,” Cohn said.