The President's speech on financial reform across the street from the New York Stock Exchange elicited little interest from the trading community, as important as it was.
The reason? Political pragmatism. Financial reform has taken a back seat to health care reform.
Now, he is trying to revive that interest by capitalizing on the anniversary of the Lehman collapse. But one trader summarized the Street's feeling in a note to me this morning: "he's throwing a bone to those that want reform but its clear that he's not willing to fight for the type of reform so many of his supporters wanted. He's taking enough hits on health care."
The president is certainly juggling an enormous amount of legislation on healthcare, financial reform, and energy legislation.
But there is a difference between financial reform and healthcare reform: there is a much stronger base of support for financial reform. As one trader noted to me: "He will get much more support on this because the public will perceive that many more people will be helped than hurt and it won't cost us all nearly as much."
On CNBC.com now:
That's why some believe that, rather than being dead, Obama is prepping the electorate for a push on financial reform once healthcare gets passed in some (likely watered-down) form.
Remember, there is plenty of room to negotiate. The administration has submitted several hundred pages of documents to Congress outlining roughly what form regulatory reform should take, including a Consumer Protection Agency and a systemic risk regulator that would set capital standards for banks. But the details are fuzzy.
Bottom line: how much capital Obama will expend to get the healthcare bill done will likely color what the financial reform package looks like.
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