Former Lehman Trader On Reg Reform: This Week Is Beginning-of-the-End of Wall Street As we Know It

Heard former Lehman bond trader Larry McDonald on Bloomberg this morning talking about financial reform. Below is his premise, and here’s a link to McDonald’s full regulatory analysis. Best part of the post is where he comments on each key component of the House/Senate bills that have to be reconciled.

This Thursday, the-beginning-of-the-end of Wall Street as we know it will kick off. Congressional Democrats and Republican leaders will begin the “Conference” process of combining the House and Senate finance reform bills. In the history of the US financial markets, we have had many boom and bust periods, panics and scandals, and typically there is a public backlash to a severe financial crisis. The more severe, the further back the pendulum arcs. After the Crash of 1929 we had the Securities Act of 1933 and 1934 as well as the Investment Company Act of 1940. Eleven years of reform. These pieces of legislation dramatically changed the face of public finance, the capital markets and the future of Wall Street … There are three main reasons why the next three weeks may be the most important time for Wall Street in decades …