Bill Clinton says that Larry Summers misled him on financial regulation changes during the 1990s

Personally, I think that the changes that the Clinton administration agreed that are being discussed here actually made things less risky (e.g., such as Glass-Steagall). But the actions that they took that aren't being discussed (e.g., forcing banks to make loans to risky home owners) were the problem that they still aren't talking about.

Clinton administration critics on the left have said the administration was wrong to lift restrictions that prevented banks from offering commercial banking, insurance and investment services.

The Glass-Steagall Act prevented banks from offering all of these services, but key provisions were repealed in 1999. Summers and the administration supported those moves at the time.

Former President Bill Clinton recently said he received bad advice from Summers on derivatives, another key part of the financial reform legislation now under consideration.

Clinton said it was wrong to think rules on derivatives did not need more transparency.

“I think they were wrong and I think I was wrong to take” their advice, Clinton said in an interview last week with ABC’s “This Week.”

Summers and his predecessor as Clinton’s Treasury secretary, Robert Rubin, had argued that only a handful of people would be buying derivatives and they didn’t need extra protection, Clinton said.



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