–Key Republican Senator: Regulatory Reform ‘Very Complicated’
–Sen. Shelby: ‘This Is Very Important’ To ‘Do Right
–Senate Still Set For 4:30 P.M. Vote To Start Reg Reform Vote

By John Shaw

WASHINGTON (MNI) – Senator Richard Shelby, the ranking Republican
on the Senate Banking Committee, told Market News International Tuesday
that he is continuing to work with Banking Committee Chairman Chris Dodd
on a bipartisan regulatory reform bill.

“We’re still talking, we’re still working. This is very important.
It’s very important to do this right,” Shelby said.

But Shelby did not appear to suggest a breakthrough is imminent.

“This is all very complex. The Dodd bill is more than 1,300 pages.
There are a lot of issues to work through,” Shelby said.

Shelby spoke to Market News International about an hour after
Senate Majority Leader Harry Reid scheduled a second test vote at 4:30
p.m. on formally beginning the regulatory reform debate.

In comments on the Senate floor, Reid continued to blast both
Senate Republican leaders and Wall Street, implying they have created a
cynical alliance to derail regulatory reform.

Speaking after Reid, Senate Minority Leader Mitch McConnell said
that Democrats continue to “rush” financial regulatory legislation.

McConnell said that the Democratic bill is poorly drafted and could
have seriously negative unintended consequences over many sectors of the
American economy.

In the first test vote Monday evening, Senate Republicans united to
defeat a Democratic motion to formally begin debate on a financial
regulatory reform bill.

The Senate voted 57 to 41 to begin the debate, but sixty votes were
required.

All Republicans who were present voted to block the debate from
going forward. (Two Republican senators did not vote.) All Democrats
voted to begin the debate except for two: Nebraska Senator Ben Nelson
and Senate Majority Leader Harry Reid.

But Reid changed his vote to No only after the outcome was apparent
for procedural reasons. This allowed him to bring the measure up again
for a future vote.

Democratic leaders have said they will continue to hold votes on
the Senate floor to formally launch the regulatory debate as a way to
put pressure on Republicans.

Dodd’s legislation establishes a new independent Consumer
Protection Bureau at the Federal Reserve Board, creates a process to
liquidate failed financial firms, sets up a council of regulators to
oversee systemic risk in the economy, establishes a regulatory structure
for over-the-counter derivatives, requires hedge funds that manage over
$100 million to register with the SEC and creates a new office within
Treasury to monitor the insurance industry.

The Senate Agriculture Committee approved a narrower bill last week
that tightens regulation on derivatives. Parts of this bill are
expected to be merged with Dodd’s bill when the formal Senate debate
begins.

The House passed a broad financial regulatory reform bill in
December.

President Obama has said that financial regulatory reform is one of
his central goals for the rest of this legislative session.

** Market News International Washington Bureau: (202) 371-2121 **

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