The Senate voted 60 to 38 in favor of ending debate on the Wall Street reform legislation this morning, clearing the way for a final vote on the bill later today. In New York, industry veterans and Washington insiders met to talk about the ramifications of the new regulations.  Gary Gensler, the head of the Commodity Futures Trading Commission, told the audience at the Securities Industry and Financial Markets Association meeting that the work was far from over. In fact, assuming the Senate passes the bill (and it is likely to do so later Thursday) and the President signs it, much of the work to implement the new regulations will be left up to the regulators themselves. The CFTC alone has 30 areas of focus, he said. The agency will have to write the new rules within a year, possibly sooner.  The Dodd-Frank bill, named after its proponents in the Senate and House, is dubbed the most sweeping reform of Wall Street since the 1930s. Many bankers complain the new rules impose heavy compliance costs and business restraints that will make it harder to earn profits in the future. But critics of the legislation say it stops far short of truly reining in risk taking on Wall Street and many bankers complain of unintended consequences.  James Dimon, the chief executive of JPMorgan Chase, which announced a stronger-than-expected $4.8 billion in second quarter profits Thursday, said in a statement "With a need for global regulatory coordination and hundreds of rules to be written, increased focus is critical in order to implement these reforms in a way that protects consumers and the competitiveness of the U.S. financial system, while ensuring the flow of safe and sound credit."  Derivatives trading was a big focus of lawmakers. The bill requires standardized swaps to be traded on an exchange or in other centralized trading facilities, the better to promote transparency in this little-understood market. Swaps trading is a huge enterprise for the big U.S. banks, who control 97% of the trillions-dollar swaps market. Gensler has long pressed for more centralized trading of the products to promote competition and lower the risk to the system. Standardized derivatives will also have to be handled by central clearinghouses, another layer of risk management.  The bill also curbs proprietary trading by banks and changes the rules regarding the quality of capital and amounts of capital banks need to hold in reserve. The government also gets new authority to take over and unwind foundering companies deemed a systemic risk, and new authority to monitor consumer protections.
On the morning of the Senate vote on new financial regulations, Wall Street and Washington honchos meet to debate the meaning of the new rules