Thursday, July 15, 2010

Financial Oversight Reform President Obama what is in it?

Congress Passes Financial Oversight Reform - NYTimes.com

WASHINGTON — The sweeping expansion of federal financial regulation approved by Congress on Thursday and now headed to President Obama’s desk reflects a renewed mistrust of financial markets after decades in which Washington stood back from Wall Street with wide-eyed admiration.

The bill, heavily promoted by Mr. Obama and Congressional Democrats as a response to the 2008 financial crisis, cleared the Senate by a vote of 60 to 39, largely along party lines, after weeks of wrangling that allowed Democrats to pick up the three Republican votes to ensure passage.

The vote was the culmination of nearly two years of fierce lobbying and intense debate over the appropriate response to the financial excesses that dragged the nation into the worst recession since the Great Depression.

The result is a catalog of repairs and additions to the rusted infrastructure of a regulatory system that has failed to keep pace with the expanding scope and complexity of modern finance.


Place to keep your money

The legislation will be carried out mostly by the same federal workers who were on duty as the financial system collapsed. The new consumer bureau, for example, mostly will be staffed with employees transferred from the consumer divisions of the existing banking regulators.


Administration officials said they were confident that placing those employees under new leadership, and granting them new powers, would produce better results.

It creates a council of federal regulators, led by the Treasury secretary, to coordinate the detection of
risks
to the financial system, and it provides new powers to constrain and even dismantle troubled companies.

Democrats divided initially over how to pursue that goal. Some pushed to break apart large banks and curtail risky kinds of trading. Others sought a grander overhaul of federal regulation. The administration’s approach, which prevailed, instead is focused on giving existing regulators additional powers in the hope that they will produce better results.

The legislation is painted in broad strokes, so like actors handed a script, those regulators have broad leeway to shape its meaning and its impact.

This reform will foster that innovation, not hamper it,” Mr. Obama said Thursday.

In the hope
that they will produce better results. Sounds like a great law?







FinReg: More Harm Than Good?

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