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Wednesday, June 17, 2009

Obama's New Financial Regulation Plan

Today most news coverage and commentary is about President Obama's propsed financial regulation. Keep in mind that this is still a basic outline, is not yet a bill given to Congress to vote on and enact into law. Still in all it is a plan that Obama's administration seemingly will lobby and fight for. Certainly there will be many changes and concessions made by both sides of the aisle along with the White House.

CBS News published a good overview of what is being proposed. In order to discuss thiis topic more we need to at least see what it is probably and basically all about. Below is the reprint to this linked article along with video they published as well.

Highlights: Obama's Proposed Financial Fix

A Closer Look At The President's Plan To Improve Oversight Of The Financial Industry

(AP) A look at President Barack Obama's plan to improve oversight of the financial industry:

  • Creates a council of regulators called the "Financial Services Oversight Council" to monitor risk across the financial system. The council will be chaired by the treasury secretary and include the heads of existing federal financial regulators, the Federal Reserve among them, and representatives of new regulators.

  • Establishes a Consumer Financial Protection Agency to protect consumers from deceptive practices by such companies as credit card lenders and mortgage brokers.

  • Gives new authority to the Federal Reserve to supervise firms considered so big or influential that their failure could topple the economy.

  • Creates a system to dismantle a troubled firm. Once the Fed and the Treasury Department decide an institution is a threat to the economy, the Federal Deposit Insurance Corp. would step in to break it down and sell its assets with minimal impact on investors.

  • Establishes a National Bank Supervisor to monitor all federally chartered banks and federal branches of foreign banks. The Fed and FDIC would retain their existing roles in helping to supervise state-chartered banks.

  • Eliminates the Office of Thrift Supervision. Critics say the office's oversight of American International Group and IndyMac was too lax and contributed to their demise.

  • Retains the Securities and Exchange Commission and Commodity Futures Trading Commission as market regulators. However, the SEC would no longer have a role in supervising large holding companies as it did in monitoring Lehman Brothers and Bear Stearns. That role would be turned over to the Federal Reserve.

  • Gives the SEC oversight of hedge funds and other private pools of capital, including venture capital funds.

  • Requires financial institutions to retain more capital when making risky investments.

  • Calls for regulation of "over-the-counter derivatives," such as the insurance-like contracts that felled AIG. The plan leaves in question who would regulate them.

  • Aims to deter lenders from writing bad mortgages and passing the risk off to investors by requiring that lenders retain a 5 percent stake in all asset-backed securities.

  • Requires that shareholders get to vote on compensation packages for financial executives.

  • Creates an office within the Treasury Department to review the regulation of insurance companies, now done primarily by states.

  • Calls on the Treasury Department and the Housing and Urban Development Department to make recommendations on the future of government-backed mortgage lenders Fannie Mae and Freddie Mac and the Federal Home Loan Bank system.

  • Watch CBS Videos Online

    • TimelineFinancial Meltdown

      Track major events that lead to one of the most tumultuous times in Wall Street's history.


    Almost every media outlet, all teh morning television news programs were talking about this today. Everyone of them had their own comments and commentary, their own specialists and experts and their own public officials offering their views and judgements of this proposal.

    Some like it, some like some of it and some like none of it. To me, some comments made sense and some did not and as a result I am having a problem with my opinion of it. As said earlier, it may be much too soon to form an opinion as what is being released and talked about today is not - I stress - is not the final version. But what is evident is that there will be - I stress again - will be major changes in how our financial system works in the future.

    Major changes and - as much as I dislike saying this - more government regulation and oversight is needed. But maybe we have all the regulation we need - it just has not been enforced. In fact, it may have intentionally not have been enforeced perhaps leading to this crisis we and the world are now in which makes a good case for createing more regulation and giving out more power over the people to a select - elint -few.

    One major component of this proposal concerns giving more power to the Federal Reserve. In effect, the way I understand this portion of it, is that the "FED" - a privately owned and held company whose owners are more secretly guarded then the Coca Cola formula - will have total control of our financial system.

    What is scary to me about this is a comment made by Meyer Rothschild - the architect of the central banking system and "The New World Order". He said, "Let me control the finances of a nation and I care not who makes its laws". In other words - and think about how true this becomes - control every aspect of a country's finances and you control that nation. He formulated and began to put into effect his concepts and ideas back in the 1700's. He in fact, was instrumental in getting J.P Morgan started along with a host of other long time financier that have become financial mainstays in this country.

    Should you want to learn more about Rothschild simply google him and google The Federal Reserve and The Secrets of the Federal Reserve.

    I believe that the Federal Reserve has too much power and authority now. It may well have enough power to control the actions of our Presidency - regardless of who holds the position. A nation functions on its economy. The ability of people to earn, invest, buy, sell and have material posessions only money can buy. If you control a populations money supply - well, you see where we are now - don't you.

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