Romney’s former financial firm: ‘Regulation will improve liquidity and transparency’

August 23, 2012

Gawker's John Cook has posted 950 pages of internal documents from 21 firms that Mitt Romney has invested in, most of which are Bain Capital affiliates.

One of those companies is the investment firm Sankaty Advisors. Romney owned 100 percent of the firm in 2001 and 2002, "but it is absent from subsequent state and federal disclosures," writes Cook. In 2010, Sankaty put out a presentation considering the condition of financial markets in the aftermath of the 2008 crisis. And in Sankaty's view, "the new market reality" is much improved from the crisis: The market is no longer in free fall, problems have been identified, and regulation has been helpful, he notes:


(Source: Gawker)

That runs against Romney's general message on Wall Street regulations, given his call to repeal Dodd-Frank. But Romney has also indicated that he'd support a replacement to Obama's Wall Street law to achieve similar ends.

In his 59-point economic plan, Romney describes his vision in very general terms, promoting stronger capital requirements, more transparency of relationships between banks, and “provisions to address new forms of complex financial transactions.”  So like Sankaty Advisors, Romney agrees that regulation can "improve liquidity and transparency"—he just doesn't want to keep Obama's version of those regulations.

The Sankaty presentation goes on to take a closer look at how the market has recovered from the darkest days of the financial crisis, noting that defaults have dropped precipitously. While the firm doesn't specify what staunched the bleeding, this happened in the wake of the TARP bailout and other major government interventions under Bush and Obama, which Romney has supported as well:


(Source: Gawker)

But not everyone is facing the same opportunities in this "new market reality." "While the credit markets for larger lenders have re-opened, conditions have gotten worse for small businesses," Sankaty writes. And Romney would certainly agree with that.


(Source: Gawker)
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Dylan Matthews · August 23, 2012