White House officials say President Barack Obama will sign legislation next week to reform the U.S. financial system. The president is applauding the Senate's final approval of the bill.
As he returned from a brief trip to the central state of Michigan Thursday, the president said the legislation that passed the Senate will vastly reform the way big financial firms do business.
"Reform that will prevent the kind of shadowy deals that led to this crisis, reform that would never again put taxpayers on the hook for Wall Street's mistakes," he said. "The reform that Congress passed today will accomplish these goals."
The president told reporters this legislation will prevent any further financial crises like the one that started in 2008 with the failure of several large Wall Street firms.
"There will be no more taxpayer-funded bailouts. Period," he said. "If a large financial institution should ever fail, this reform gives us the ability to wind it down without endangering the broader economy. And there will be new rules to end the perception that any firm is 'too big to fail'."
Before the Senate vote, the top Republican in the House of Representatives, John Boehner, was urging its repeal, calling the legislation "unwise."
"I think that it institutionalizes 'too big to fail' and gives far too much authority to federal bureaucrats to bail out virtually company in America they decide ought to be bailed out," he said. "I think it ought to be repealed."
The president said Mr. Boehner's comments are out of step with the views of the American people.
"Now, already, the Republican leader in the House has called for repeal of this reform," he said. "I would suggest that America cannot afford to go backwards, and I think that is how most Americans feel as well. We cannot afford another financial crisis, just as we are digging out from the last one."
Shortly after the vote, U.S. Treasury Secretary Timothy Geithner said the effects of this reform will extend beyond the U.S. and into the world's markets.
"Recognizing that financial markets are truly global today, we will work hard to bring the rest of the world along with us, as we raise the standards of financial protection in the United States and reinforce the competitiveness of our nation's most innovative firms," he said.
The legislation will more tightly regulate banks, and especially the complex transactions known as derivatives. It will also extend new protections to borrowers and investors.
Also on Thursday, the large investment firm Goldman Sachs has agreed to pay $550 million to settle civil fraud charges that the company misled people who invested in mortgage-related investments. Under the deal, Goldman would pay the U.S. Securities and Exchange Commission $300 million in fines. The rest would go to those who lost money on the investments.