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Becky Quick: Senator Chris Dodd is set to unveil his financial regulation bill today. Anticipation has been mounting in recent days after Dodd cut off bipartisan negotiations with Republican Senator Bob Corker. Rob Nichols is the Financial Services Forum President, also the former Treasury Deputy Assistant Secretary and he joins us right now to talk a little more about this. Rob, this has been such a back and forth procedure at this point. Corker coming out and saying, look, there's a lot of good. This is a better bill than it was when it was first dropped but he won't support it. What's your take on this bill?

Rob Nichols: Well it's been 15 months that we've been talking about reform. And one thing the markets would like to see is certainty. Markets crave certainty, so we'd like to see it done. Today is another big day in this whole roller coaster that's been the regulatory reform debate in Congress. We're very interested in seeing the product. We understand that Chairman Dodd will be unveiling it today at 2:00 p.m. very much looking forward to seeing the details.

Becky Quick: You have a pretty good idea.

Rob Nichols: Two major deficiencies we've talked about in our supervisory architecture we think will be in there. One is the need for systemic supervision. Someone looking out for the whole financial system. Playing free safety, so to speak. I think that's going to be a council. A systemic risk council is our understanding.

Becky Quick: But how much, I mean, do they have real teeth? Or is it going to be still kicked back to other regulators?

Rob Nichols: We'll see. I think the way that the Chairman, at least our understanding, of course we'll see the details, the Chairman would envision the heads of the major entities there, the Fed, the Treasury, the FHFA, the SEC and others all collectively looking out. We think that's a good idea. Secondly the other key deficiency that we don't have in our supervisory architecture is the need for resolution or wind-down authority. So that heaven forbid a large global interconnected firm were to tail we could take it down in a non-chaotic way that doesn't impact the global capital markets or the taxpayers. We think that's critically important too. What we'll be looking for, one thing we'll be looking very closely to when we see the bill text this afternoon, is how the banks are supervised. That’s a critically important issue. It’s a big week for that as a matter of fact. Chairman Frank over on the House side is going to have a hearing that will have Chairman Bernanke will be participating in that; Chairman Volcker will be participating in that. I’ll be among others on a private sector panel talking about the role of the Fed with regard to supervising banks, and whether or not it complements its monetary policy authority.

Becky Quick: Does it?

Rob Nichols: We think so. We actually do. We think for the Fed's monetary policy authorities to be properly --

Becky Quick: To understand what's really happening?

Rob Nichols: I think it's helpful to look into the economy and all around the United States through the banks, a good window in which you can do that. That will be a key piece.

Becky Quick: It sounds like that is where things are headed from the early word.

Rob Nichols: Early word suggests that large -- the large institutions of over pay $50 billion, if the morning papers are accurate, would be the ones supervised by the Fed. Which we think is a sensible thing.

Becky Quick: People will say you represent the financial services industry. If you like this, it must not have enough teeth; it must not be doing enough. It’s not doing what the Volcker Rule, for instance, would have gone after in terms of reining in what some of the big financial services firms could be doing. In stopping some of those practices. What do you say to those critics?

Rob Nichols: Directly speak to the Volcker rule first. With great respect to the former chairman, trading, or otherwise didn't lead to the crisis.

Becky Quick: People say you can't just look where -- you can't just look at what caused things last time around because that's not going to be what causes problems next time.

Rob Nichols: Understood. But we think more effective supervision over the entire system, not just the large institutions or the small institutions, but more effective supervision over the large system coupled with resolution authority is probably the better course of action rather than pro-actively, preemptively breaking up, capping the scope of activities of the large institutions. With regard to your overall question, in terms of whether the industry likes it, does this not make it a good piece of legislation? I think that's kind of a small --

Becky Quick: Cynical view?

Rob Nichols: A smidge of a cynical view. Instead let's work together. Let’s have the Administration, let's have Congress and let's have the industry work together. The issues are remarkably complex. Having a role. Being able to participate in the policymaking conversation is utterly sensible. And to suggest it shouldn't take place without industry expertise I think is a little misguided.

Becky Quick: This legislation will not be supported by Corker. Will it pass?

Rob Nichols: We're hopeful, the industry is hopeful for a bipartisan bill this year. That would be our hope.

Becky Quick: So you hope some Republicans get behind it?

Rob Nichols: Absolutely. And the good news here, and let me take time to thank both Ranking Member Shelby and Bob Corker as well as Chris Dodd, because they've spent countless hundreds of hours working on this. There is time for a bipartisan deal to come back together. So it is this March. There is some time and I understand the Chairman's view that he wants to -- that he, you know, he needs to move the ball forward. We respect that. But there is time for both parties to come back together.

Joe Kernen: You live down there. You must be blinded by it. What is that word you used?

Rob Nichols: Bipartisan.

Joe Kernen: Yeah. What is that again?

Rob Nichols: Most good pieces of legislation that come out of the policymaking process, Joe, are bipartisan.

Becky Quick: But you want to see the Republicans just support this existing bill or you want to see them get involved and change the bill from what it is right now in order to support it?

Rob Nichols: I think both parties' voice in this process would probably be better than one party's voice.

Becky Quick: You'd like to see the Republicans get involved and maybe change things a little bit?

Rob Nichols: We would like to see all the members of the Banking Committee have a robust conversation. Apparently Chairman Dodd intends to mark this up as early as next week. Let’s have an open bipartisan discussion about getting the details right. It’s esoteric, complex stuff that comes up twice in 100 years. It doesn't come up every year. We’ve got to get the details right. And it would be great to have both parties working together.

Joe Kernen: On the bipartisan level, you wonder with this vote looming on Friday, it's a heads you win, tails you lose. If it passes acrimony is going to be even greater. And if it doesn't pass the acrimony is going to be even greater. I don't know. I don't see anything getting done after this. Because it will be so much buyer and outrage if it goes through this way. And if it doesn't go, the Republicans are going to smell blood and they're not going to let anything go through. So you better do this quick. I love when you keep saying we're looking forward -- you're so nice about it. But, okay. You’re looking forward to seeing what's there. You’re not looking forward to it. You’re looking forward to seeing what's in it.

Rob Nichols: To seeing what's in it.

Joe Kernen: So you know. But you're not looking forward to it. Are you?

Rob Nichols: We do need new rules of the road. Overseeing the financial services industry.

Joe Kernen: I’ll never be -- I can't do it.

Becky Quick: you could never --

Joe Kernen: No.

Becky Quick: And you can never be a Twitter either.

Joe Kernen: and I could never tweet because I’m not a twit. Keep twittering. Carl might have stayed home just to tweet all day long. He loves it so much now. You listen to cold play and tweets are what he does.

Rob Nichols: I think you should set up an account.

Joe Kernen: all right.

Becky Quick: Rob, thanks for coming in.