Better Markets Month in Review August 2022 Bulletin
View the online newsletter here.
August is usually a sleepy month in Washington, but the past month has been incredibly busy for our team at Better Markets. In the past few weeks alone, we’ve fought for low- and middle-income communities by reforming the Community Reinvestment Act, urged federal banking agencies to stop mindlessly allowing mergers that create more oversized megabanks. to file for bankruptcy, applauded the conviction of JPMorgan officers for committing financial crimes, and released our second report in our series on shadow banks on money market funds. These activities show the enormous expertise of our team and the scope of our work. Learn more about these activities below.
In addition to these action items, we are also thinking more broadly about creating a financial system that works for all Americans. We used the one-year anniversary of Robinhood’s IPO to discuss how the financial industry has failed Main Street Americans when using financial products and how we can truly democratize Wall Street. . The Better Markets team wrote a law review article in the Western New England Law Review in which we argue that Wall Street and finance in general can and should be democratized. However, Robinhood’s model, based on maximizing frequent high-risk trades incentivized by predatory gamified apps to generate as much short-term profit as possible for Robinhood, is not how. These are exploitative and manipulative practices that enrich Wall Street at the expense of Main Street customers and, often, those least able to bear the losses.
In a recent op-ed in the San Francisco Chronicle, I went on to write that we need a “Real Robin Hood” on Wall Street who actually provides Main Street investors with real opportunities to trade, invest and create wealth at an affordable price.
Exposing wrongdoing on Wall Street and pushing regulators to enact rules to protect Main Street is essential. Yet it is also important to provide a positive vision of how we can create an economic system that works for all Americans, that creates wealth and opportunity on a large scale, and that is supported by a financial system focused on the real productive economy and not on wealth. extraction and predatory behavior.
We appreciate your support and look forward to continuing our conversation on how to build this economic system in the months ahead. Better,
Co-Founder, President and CEO Better Markets
On TV, radio and print, Better Markets’ views on all issues related to financing the economy were sought and featured in major news outlets. Here are our best hits of August.
Asset Managers Bet Big on Crypto Despite Market Rout
“Just because top companies want to make money off something new doesn’t mean it’s a good thing to do. This volatility would normally be a red flag warning.
JPMorgan Gold Traders found guilty after lengthy impersonation trial
“[The verdict] should signal to the biggest financial firms and Wall Street executives that they are not above the law.
“The riskiest loans are outside the banking system.” Regulators fear hedge funds could trigger the next financial crisis.
“Private funds have become increasingly important in Treasury markets. In March 2020, we saw the Treasury markets crash and much of the liquidity dry up. »
Robinhood cuts 23% of its workforce amid crypto crash
“Robinhood is unique in some ways for having the perfect combination of a successful predatory business model at a time when retail investors’ appetite for participating in the markets was at an all time high. History has shown that retail traders increase their participation in bull markets and decrease their participation in bear markets.
A Young Crypto Billionaire’s Political Agenda Goes Far Beyond Pandemic Preparedness
“[FTX’s proposal] removes a historical layer of protection that has worked extremely well. Markets will be transformed in such a way that the interests of producers and real buyers will end up being subordinated to speculators and financial products.
Senate plan would put Bitcoin and Ether under scrutiny of commodity regulator
“People who take actions that could undermine our securities law are playing with fire. You can love or hate the SEC, but transparent disclosure, clear rules…and enforcement are what build trust in our markets.
*You can find all of Better Markets’ August media hits here.
Credit, investing, and banking services have been unjustly denied to many Americans for far too long. The ARC was supposed to change that, but it didn’t have an impact in key areas like home ownership and wealth. Our comment letter asks that the CRA be strengthened to address these issues.
Here’s an idea… funds that claim to be engaged in ESG investments should actually have significant ESG investments. It sounds simple enough, but Wall Street has vigorously fought the SEC’s proposal to ensure investors aren’t misled by fund investments and names. Read our comment letters to learn more.
Federal Reserve and OCC should stop approving too-big-to-fail bank mergers without real resolution plans
Better Markets has filed a comment letter in response to the Securities and Exchange Commission’s request for comment on “information providers”, whose activities may warrant regulation as investment advisers. The SEC should develop reforms that will increase transparency, protect investors from conflicts of interest and other threats inherent in the business model of information providers; to promote fair competition among all those who act as investment advisers by regulating them in the same way; and protect the overall integrity of the securities markets.
Each month, our legal team outlines some of the top cases we keep tabs on, the Amicus “Friend of the Court” briefs we’ve filed, and why anyone with a bank account, credit card, of a mortgage loan or a pension loan should be interested in these cases.
Read the latest updates from our team of legal experts.
There have been some exciting new developments in the world of financial regulation, including proposed new legislation that would change how Washington oversees the rapidly growing field of cryptocurrency.
U.S. Senators Stabenow (D-MI) and Boozman (R-AR), who serve as chair and ranking member of the Senate Agriculture Committee, respectively, introduced the Digital Consumer Protection Act of 2022, which would put Commodity Futures Trading Commission responsible for regulating most digital commodities. The Senate Agriculture Committee oversees the operations of the CFTC, so this legislation would put the Committee directly in the driver’s seat of congressional efforts to regulate cryptocurrencies.
Better Markets has long feared that putting the overburdened and underfunded CFTC in charge of a fast-growing field like crypto is just asking for trouble. Dennis Kelleher has previously described the CFTC as “the smallest financial regulator with the smallest budget”. If people really want the CFTC to properly regulate crypto, they should start by doubling the CFTC’s current budget so that it has enough funding to do its job now. Then add the amount of funding needed on top of that for it to be able to do the vastly increased crypto-related work.