FOX5's John Huck asks Press Sec. Spicer how Trump’s financial de - FOX5 Vegas - KVVU

FOX5's John Huck asks Press Sec. Spicer how Trump’s financial deregulation could affect Nevadans

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LAS VEGAS (FOX5) -

A plan to repeal Dodd-Frank regulations could have major impacts on small business owners and consumers. How that impact would be felt, and where, remains to be seen.

On Tuesday morning, FOX 5’s John Huck was able to ask White House Press Secretary Sean Spicer about the president's plan to roll-back financial regulations and repeal Dodd-Frank.

It was one of President Trump's central campaign promises, and he said it would encourage business growth.

Those reforms were put into place following the great recession.

With the help of legal analyst and real estate expert Bob Massi, explained why the valley has a lot riding on how this deregulation turns out.

Las Vegas felt an unexpected crash of the housing market in 2007 and 2008.

The double-digit gains in home prices disappeared. They were replaced by foreclosure signs dotting neighborhoods. The fallout was staggering and construction, visitors and jobs vanished.

The collapse started with subprime mortgages that banks were handing out like candy.

Wall Street investment banks took this risky debt, and like putting lipstick on a pig, combined it with good investments. They sold the whole package as high yield mortgage backed securities.

“They bound them up and they sold them. And the buyers of those particular bundles never really checked the way they should that they were AAA loans when in fact they were not!” Massi said.

“It worked as long as home prices kept going up, but the market crashed and homeowners owing more than their homes were worth, walked away. Those mortgage-backed securities were worthless,” Massi said.

President Barack Obama signed Dodd-Frank into law in 2010.

“It brought the most significant changes to financial regulation in the U.S. since the great depression, including wide-reaching regulation of the financial markets.

President Trump said he now wants to roll back those financial regulations. On Tuesday, he took another step by signing House Joint Resolution 41, which repeals regulations on the energy markets.

"This is one of many we've signed and there's many more left. We're bringing back jobs big league. We're bringing them back at the plant level, at the mine level.  The energy jobs are coming back and you see what's going on the stock market because we know what we're doing so it's going up at record clips,” Massi said.

The president said repealing Dodd-Frank will empower investors and free up capital for small businesses.

But critics have asked, ‘Without those regulations in place, will Wall Street create another bubble, another financial crisis, that main street will pay for down the road?’

“It gets to the very sophisticated dynamic of the use of money. The expenditure of money, the people that have money available to them. So, depending on who you talk to is going to depend upon what is best for the country,” Massi said.

Tuesday's action marked just the second time any U.S. president has used the Congressional Review Act of 1996 to revoke a rule or regulation from a previous administration.

The law gives incoming presidents and congress the power to reject rules imposed by outgoing administrations inside their last 60 days.

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