Big banks stop honoring California IOU's after Friday
The biggest U.S. banks, including Wells Fargo & Co. and Bank of America Corp., JP Morgan Chase and Citibank announced plans to stop exchanging the registered warrants for cash after Friday. According to BofA spokeswoman, Britney Sheehan, the longer the banks accept the warrants the longer it will take the state in reaching a budget agreement. California last week issued 90,000 IOU's for a total value of approximately $355 million.
Obama Administration seeks to give more authority to SEC
The Obama administration on Friday proposed to strengthen the Securities and Exchange Commission's investor protection authority. The proposal includes a measure that would empower the agency to examine and ban forms of compensation that encourage financial intermediaries to steer investors into products that are profitable to the brokers themselves but are not in the investor's best interest.
Geithner plans to reform derivatives
Treasury Secretary Timothy Geithner on Friday proposed his plan of bringing all over-the-counter derivatives under strict federal oversight in an effort to make the financial system more stable and eliminate risks. The Obama administration is seeking to make the OTC derivative markets fully transparent, with access to transactions available on a confidential basis to relevant regulators.