Obama signs sweeping Wall Street overhaul into Law

By Ross Colvin

WASHINGTON | Wed Jul 21, 2010 12:50pm EDT

(Reuters) - President Barack Obama on Wednesday signed into law the most comprehensive financial regulatory overhaul since the Great Depression and vowed there will be no more taxpayer-funded bailouts for Wall Street.

"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 for the legislation approved by the U.S. Congress last week.

The bill targets the kind of Wall Street risk-taking that helped to trigger a global financial meltdown and also aims to strengthen consumer protections.

Obama, who has drawn fire from Americans for bank bailouts that began under Republican President George W. Bush and continued by Obama, said the legislation's provisions make clear that no firm is protected because it is deemed "too big to fail" like AIG during the financial meltdown.

"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."

Obama spoke to an audience of about 400 people in the Ronald Reagan Building close to the White House that included Wall Street bankers, people hurt by the 2007-2009 financial crisis and lawmakers.

The Senate last week gave final approval to far-reaching legislation sought by the Obama administration to tighten rules on Wall Street and across the financial industry in an effort to avoid a repeat of the financial crisis.

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.

But it remains unclear whether Obama can gain much traction from the legislative victory, with Americans still anxious about a 9.5 percent jobless rate and ballooning deficits.

The American Bankers Association expressed disappointment with the legislation, saying it "contains a tsunami of new rules and restrictions for traditional banks that had nothing to do with causing the financial crisis in the first place," said ABA President Edward Yingling.