Will Trump Force Fed’s Hand on Exec Comp, Capital Rules?
By John Heltman
President-elect Donald Trump’s victory poses a unique quandary for the Federal Reserve both before and after he is sworn in — whether the central bank should attempt to finish the many rules still in process or keep its head down to avoid provoking a hostile Congress. The Fed has a raft of rules still outstanding, many of which relate to the Basel III accords and Dodd-Frank requirements that remain incomplete…. Karen Shaw Petrou, managing partner at Federal Financial Analytics, said that there typically is a rush at the end of each calendar year to get rules out the door, and that this tendency is heightened during administration changes — even between terms of the same president. But with this particular transfer of power, where there are major ideological differences between the parties relinquishing control and those assuming it, that normal rush will likely be intensified — even if just to make policies that much harder to reverse. “I think that will be hyperactive policymaking, because I think the Obama administration and the federal regulators will try … to get as much done as they can before the new president and structure come in,” Petrou said. “I think they will try to finish as much as they can to try to force policy reversals through a more lengthy, deliberative process.”