Financial Watch

President Obama’s speech on Wall Street last week signals that a year after one of the worst financial panics in U.S. history, financial reform is on its way. Though reform will not prevent all future crises, it will make them less frequent and less likely to pose the same lethal threat to the economy.

That reform is necessary almost goes without saying. The financial system issued trillions of dollars in bad loans over the last decade – loans unlikely to be repaid under even the best of circumstances – creating the fodder for the subsequent financial panic and Great Recession. Its legal merits aside, the recent Securities and Exchange Commission suit against Goldman Sachs Group Inc. brings into sharp relief all that we feared about the financial system: that it has become opaque, conflicted, and dysfunctional.

World stock markets fell Thursday as mounting concerns about Greece’s debt crisis eroded investor confidence following a bright finish on Wall Street the day before.

In Europe, the FTSE 100 index of leading British shares was down 43.95 points, or 0.8 percent, at 5,679.48 while Germany’s DAX fell 53.15 points, or 0.9 percent, to 6,177.23. The CAC-40 in France fell 40.82 points, or 1 percent, to 3,936.85.

Wall Street was poised to open lower too — Dow futures fell 30 points, or 0.3 percent, to 11,029 while the broader Standard & Poor’s 500 futures fell 4.4 points, or 0.4 percent, to 1,196.

President Barack Obama will push for his plan to tighten Wall Street regulations in New York on Thursday, the White House said on Monday, as he attempts to overcome solid Republican opposition.

The battle over a financial regulatory overhaul represented a new election-year fault line in Washington after the bruising healthcare debate, and poses a new challenge for Obama as he seeks to gain passage of one of his key domestic priorities.

Democrats have seized on a fraud suit against Goldman Sachs as an example of why Wall Street needs to be cleaned up after a financial crisis that triggered the worst U.S. recession since the Great Depression.

“The battle over reshaping the country’s financial regulation escalated on several fronts Wednesday, with President Obama stepping up his personal efforts to win Senate passage of an ambitious bill while senators from both parties fought to claim the anti-Wall Street mantle. After a White House meeting between Obama and congressional leaders, Republican leaders criticized the Democrats’ proposal for leaving the door open to future bailouts of big financial firms. But the president, who has turned his attention to the financial overhaul after winning passage of health-care legislation, said he was confident that a bipartisan bill could be worked out to ensure that the economy is protected from the collapse of large financial companies.”

U.S President Barack Obama will try to turn up the pressure for an overhaul of Wall Street regulations as he meets on Wednesday with top Democratic and Republican lawmakers to discuss a sweeping package of reforms.

Republicans are seizing on a provision that would allow regulators to step in to dismantle large, troubled firms. They argue that would set the stage for “endless” bailouts of Wall Street, a claim the White House says is false.

The White House meeting, at 10:45 a.m. (1445 GMT), will include Senate Republican leader Mitch McConnell and House Republican leader John Boehner. Obama’s Democrats will be represented by Senate Majority Leader Harry Reid, House of Representatives Speaker Nancy Pelosi and House Democratic leader Steny Hoyer.

After claiming victory on health care overhaul, President Obama is now turning his attention to reshaping the financial regulatory system.

“I think it is one of the president’s top priorities now,” White House spokesman Robert Gibbs said this week.

As he did during the yearlong health care battle, the president has invited congressional Republicans and Democrats to meet with him on Wednesday to discuss proposals to overhaul financial regulations. And just like the health care debate, financial reform is becoming increasingly partisan.

Obama hopes the meeting with top lawmakers will help him forge a bipartisan agreement on the issue or at least help win over a few centrist Republicans.