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Posts Tagged ‘Consumer Financial Protection Agency’

Without Transparency, Financial Regulatory Reform Gets a “D”

Posted by Larry Doyle on March 15th, 2010 9:50 AM |

Bloomberg just provided a sneak peek at the Financial Regulatory Reform package to be proposed by Senator Chris Dodd (D-CT) this afternoon. What are some of the highlights and my thoughts? Let’s navigate.

From the top down, and without being overly cynical, I am extremely concerned that this proposed financial regulatory reform is a reshuffling of deck chairs with increased powers for both the Federal Reserve and U.S. Treasury. The very fears I voiced almost a year ago remain entrenched. What is the basis of my fear? The so-called reform is much more focused on the “sufficiency” of regulation of our financial industry and not nearly focused on the “transparency” of the regulation, the regulators, and the regulated.

Call me suspect.

What are the key highlights as reported by Bloomberg? (more…)

Elizabeth Warren Exposes Jamie Dimon

Posted by Larry Doyle on February 9th, 2010 8:37 AM |

Elizabeth Warren and Jamie Dimon

Elizabeth Warren and Jamie Dimon

How is it that some people are able to aggressively promote the virtues of truth, transparency, and integrity within our financial system while others would seem to talk a good game but do not truly walk the walk? The key, in my mind, is that the former are not beholden to a constituency focused on short term maximization of profits and revenues. Who is distinguishing herself as a leader in this category? Elizabeth Warren, the current chair of the Congressional Oversight Panel to investigate the U.S. banking bailout.

Warren writes in today’s Wall Street Journal of Wall Street’s Race to the Bottom. This race is very much a function of implementing strategies and developing products that have served to maximize the short term revenues of these firms, while eroding the very foundation of the financial system itself. (more…)

Consumer Financial Protection Agency or Sense on Cents

Posted by Larry Doyle on June 17th, 2009 9:27 PM |

A large initiative embedded in President Obama’s financial reforms is the launching of the Consumer Financial Protection Agency. Why does President Obama feel it is necessary to launch such an agency? For the very same reason I was compelled to launch Sense on Cents earlier this year.

The Wall Street Journal provides insights on this agency in writing, A New Consumer Agency With Enforcement Teeth:

President Barack Obama’s proposed regulatory revamp includes sweeping changes to help consumers make informed decisions about financial products, save for retirement and get better investment advice.

A centerpiece is the creation of a Consumer Financial Protection Agency with authority to write and enforce rules across a slew of financial products.

Firms would also have to offer “plain vanilla” versions of products — such as a mortgage that does not include prepayment penalties and has predictable payments — along with their other offerings. The goal is to make it easier for consumers to shop around without worrying about hidden fees.

“The new agency is about making consumer credit markets work,” said Elizabeth Warren, chairman of the Congressional Oversight Panel, which oversees the government’s Troubled Assets Relief Program. Ms. Warren had proposed the idea of a financial-products safety commission in an article published in the journal Democracy in 2007.

“It’s not possible for a customer to compare three or four credit-card products and determine which one is the cheapest and which one poses the least risk,” Ms. Warren said. “This agency is about changing that.”

Consolidating the job of consumer oversight into one agency could help resolve consumer disputes more quickly and effectively.

Clearly the financial industry has not had the interests of consumers at heart. Why are so many investors dissatisfied with their banks, brokers, and financial planners? The financial companies and individuals did not protect the customers. More often than not, brokers and bankers themselves were ill equipped to understand the dynamics at work within products, the market, or the economy. (more…)






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