Obama signs sweeping Wall Street overhaul into law

Updated: 2010-07-22 14

(Agencies)

President Barack Obama signs the Dodd-Frank Wall Street Reform and Consumer Protection Act in Washington, July 21, 2010. [Agencies]

President Barack Obama signed into law on Wednesday the most comprehensive financial regulatory overhaul since the Great Depression, vowing to stop risky behavior on Wall Street that imperiled the US economy.

Influential business groups lined up to criticize the new law, underscoring Obama's uneasy relationship with America's business community. Some on Wall Street, however, welcomed the clarity offered by the law after months of wrangling in Congress over what should be in the legislation.

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The law, which got final approval from the Senate last week, targets the kind of Wall Street risk-taking that helped trigger a global financial meltdown in 2007-2009 and also aims to strengthen consumer protections.

Obama, facing voter unrest over Wall Street bailouts that have failed to spark a strong Main Street job recovery, pledged taxpayers would never again have to pump billions of dollars into failing firms to protect the economy.

"Because of this law, the American people will never again be asked to foot the bill for Wall Street's mistakes," Obama said at a signing ceremony attended by some Wall Street bankers, business leaders and lawmakers.

"There will be no more taxpayer-funded bailouts. Period."

With Republicans poised to make gains in the November congressional elections, Obama's Democrats are eager to show voters that they have taken steps to tame an industry that dragged the economy into its deepest recession in 70 years.

Obama and Democrats have yet to gain political traction from the legislative victory, with Americans still anxious about a 9.5 percent jobless rate and ballooning deficits.

The financial regulatory reforms were a major achievement for Obama and his ambitious domestic agenda. Earlier this year he signed into law sweeping reforms of the United States' $2.5 trillion healthcare system.

The financial reforms won Democrats few friends on Wall Street. Wealthy donors have started to steer more campaign contributions to Republicans, who voted overwhelmingly against the reforms.