SAN FRANCISCO — President Obama on Saturday sharply criticized Wall Street for worsening the economy's downturn and promised to make financial markets more transparent and accountable.
In his weekly radio and Internet address Saturday, the president applauded the House of Representatives for passing sweeping financial reform legislation on Friday and said the economy is recovering from the "irresponsibility" of Wall Street firms that "gambled on risky loans and complex financial products, seeking short-term profits and big bonuses."
It was "risk management without the management," Obama said. "Their actions, in the absence of strong oversight, intensified the cycle of bubble-and-bust and led to a financial crisis that threatened to bring down the entire economy."
Obama also blamed an "era of easy credit" for some of the excesses. "Millions of Americans borrowed beyond their means, bought homes they couldn't afford, and assumed that housing prices would always rise and the day of reckoning would never come," he said.
Digital Access For Only $0.99
For the most comprehensive local coverage, subscribe today.
"It was a disaster that could have been avoided if we'd had clearer rules of the road for Wall Street and actually enforced them," the president said.
The House on Friday narrowly approved the most comprehensive financial industry regulations since the Great Depression, including new restrictions on the biggest banks and the Federal Reserve. The legislation also would create a Consumer Financial Protection Agency to oversee mortgage, credit card and other banking products.
Obama urged the Senate to act quickly on its own financial reform proposals to ensure that the "risky dealings that sparked the crisis would be fully disclosed and properly regulated." And he criticized Republicans and financial industry lobbyists for blocking efforts to mandate tougher rules.
In an interview with CBS' "60 Minutes" program scheduled for broadcast today, Obama condemns bankers for taking government bailout money and now collecting handsome bonuses.
"I did not run for office to be helping out a bunch of fat-cat bankers on Wall Street," Obama said, according to excerpts from the interview released Saturday.
The president said that "the people on Wall Street still don't get it.... They're still puzzled why it is that people are mad at the banks. Well, let's see. You guys are drawing down $10, $20 million bonuses after America went through the worst economic year ... in decades and you guys caused the problem.
"What's really frustrating me right now is that you've got these same banks who benefited from taxpayer assistance who are fighting tooth and nail with their lobbyists ... up on Capitol Hill, fighting against financial regulatory control," the president said.