Overnight Finance: Warren banking bill poses challenge to Hillary

TOMORROW STARTS TONIGHT: WITH GLASS-STEAGALL BILL, WARREN CHALLENGES CLINTON CAMPAIGN. Sen. Elizabeth Warren (D-Mass.) reintroduced Glass-Steagall legislation on Tuesday. The bill, which would require banks to divide commercial banking and investment banking, has almost no chance of becoming law this Congress. But here’s why it still matters:

1.) Glass-Steagall is popular among the liberal base. Progressives argue that President Bill Clinton’s 1999 repeal of the legislation contributed to the 2008 economic crisis. Most economists — as well as the Clintons — vehemently refute this allegation. But liberals love Glass-Steagall, including two of Hillary Clinton’s primary challengers: Sen. Bernie Sanders (I-Vt.) and former Md. Gov. Martin O’Malley, who tweeted his support for it earlier this afternoon.

2.) Glass-Steagall puts Clinton in a tough spot with Wall Street. For the months leading up to the campaign season, liberals have been weary about Clinton’s close ties to Wall Street. Welp, nothing makes the banking industry’s blood boil more than Glass-Steagall.

{mosads}3.) The Glass-Steagall bill won’t survive — but will fuel Wall Street critics. No one is predicting this will become law. Tony Fratto, the D.C. business comms guru, called it “irrelevant” earlier today. But the anti-big bank rhetoric will be a presence on the campaign trail at least with the left. That’s could be a problem for the banking industry… My read for The Hill: http://bit.ly/1KQtIPO

THIS IS OVERNIGHT FINANCE, and it’s only Tuesday. I saw Jurassic World again. And this time is was a lot better. The ending was awesome. Tweet: @kevcirilli; email: kcirilli@digital-release.thehill.com; and subscribe: http://digital-release.thehill.com/signup/48

COME HEAR THE HILL TALK ABOUT WONKY STUFF. In the wake of the global economic crisis, the financial sector is coming under increased scrutiny and international regulators are seeking to reform how insurers are supervised. But have overseas regulators become too powerful? Register here: http://bit.ly/1flwjpn

TALK OF THE TOWN: CLINTON JABS TRUMP, via Niall Stanage and Jonathan Easley: Hillary Clinton slammed Donald Trump for his comments on Mexican immigrants in the first national interview of her presidential campaign. “I’m very disappointed in those comments, and I feel very bad and very disappointed with him and with the Republican Party for not responding immediately and saying, ‘Enough, stop,” Clinton said in the interview with CNN’s Brianna Keilar.http://bit.ly/1JMX96L

PUERTO RICO POLITICS. This is shaping up to be a major policy issue, especially with Greece in the news.

— SANDERS, via Pete Schroeder: Sen. Bernie Sanders (I-Vt.) joined calls to allow Puerto Rico to declare bankruptcy while blaming Wall Street and austerity policies for the island’s grim fiscal picture. The Democratic presidential candidate said Tuesday that Congress should change the law so that Puerto Rico can allow its entities to declare bankruptcy, just as states can do for municipalities. http://bit.ly/1gmqrMO

— CLINTON, via Jesse Byrnes: Hillary Clinton on Tuesday called on Congress to allow Puerto Rico to access United States bankruptcy laws amid a looming debt crisis in the island territory. http://bit.ly/1CZ5E6M

PAY-DAY LENDERS GIVE TO GOP, via Schroeder: “Payday lenders spent more than $15 million trying to influence top Republicans ahead of the 2014 congressional elections, according to a new report. The report from left-leaning Americans for Financial Reform released Tuesday shines a spotlight on ties between the GOP and the controversial payday lending industry.” http://bit.ly/1CnURs0

EX-IM WATCH, via me: Conservatives have identified a new line of attack to use against the Export-Import Bank in the event that the embattled institution wins reauthorization in Congress this summer. The bank’s critics plan to block President Obama from filling vacancies on Ex-Im’s board of directors, a strategy that if successful would significantly weaken the bank’s operations. http://bit.ly/1eDE1u9

NEW JOB: PHIL LARUE. The former comms guru for the New Democrat Coalition is now director of government relations for the Concord Coalition. He began his work this week. LaRue in a statement: “The Congressional Budget Office’s projections make clear that Democrats and Republicans must come together and take action to put our country on a sounder fiscal footing as soon as possible. If we do, we can pave the way to a brighter economic future for all of us.”

FIRST LOOK –  -> FIDUCIARY FALL-OUT, via me: The business community is ramping up attacks against President Obama’s proposed regulations for financial advisers. The conservative American Action Network is launching a 30-second $100,000 ad buy Wednesday that urges Congress to oppose Obama’s proposal, known as “fiduciary rules.” The ad buy comes two weeks before the Department of Labor (DOL), which is overseeing implementation of the rule, closes its public comment period July 21. The ad will run this week on Fox News as well as on “Fox News Sunday” this weekend. Watch the ad: http://bit.ly/1Rj2yq7 My story: http://bit.ly/1J35Bcf

— Meanwhile, per a release from The Financial Services Institute (FSI) earlier today: “[FSI] launched a new microsite for investors to weigh in with their members of Congress and the Department of Labor urging them to protect their retirement by ensuring their access to financial advisors, products and services that they depend on today for dignified retirement.” The site: http://bit.ly/1H8SExl

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