Standing shoulder-to-shoulder with Paul Volcker and Joe Biden, President Obama proposed plans to curb the finance industry by re-enacting Depression-inspired banking legislation.
Obama is expected to publicly endorse proposals by Paul Volcker, including limits to proprietary trading within commercial banks. Volcker believes banks should be broken up, essentially leading to the resurrection of the Glass-Steagall act of 1933.
Volcker, who was head of the Federal Reserve in the 1970s/1980s, is often referred to as the Dean of American banking. He is widely respected as a man who has the balls to do what it takes to make things right.
Volcker has publicly stated that many financial innovations provide no benefit - and are often dangerous - to society as a whole. In fact, he proposes the current system (as demonstrated via the bailouts) presents high risks to society but high rewards for banks. Interests are clearly not aligned.
I believe the fact Geithner and Summers were nowhere to be seen sends a big message. The Obama administration is taking a hard-line position against the banks. Politically-motivated or not, such a move is welcome given the ridiculous antics (high risk behavior, bailouts, subsequent return to high risk behavior, followed by record-breaking bonuses) of banks over the past 2 years.
Such threats to the banking industry are bad for bank executives and bank shareholders...but a stable banking system will be good for society (and the economy) over the long run.