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President Obama's Proposed CONSUMER FINANCIAL PROTECTION AGENCY (CFPA)! Will It Replace Other Agencies? Republican Naysayers & NEGATIVE CORRELATION!
President Obama’s
Proposed
CONSUMER
FINANCIAL
PROTECTION
AGENCY (CFPA)!
Will It Replace
Other Agencies?
Republican
Naysayers &
NEGATIVE
CORRELATION!
http://www.reuters.com/article/governmentFilingsNews/idUSNN1451081220090914
Text of Obama's New York speech on
financial reform
Mon Sep 14, 2009 12:31pm EDT
That's why we need strong rules of the road to guard against the kind of systemic risks we have seen. And we have a responsibility to write and enforce these rules to protect consumers of financial products, taxpayers, and our economy as a whole. Yes, they must be developed in a way that does not stifle innovation and enterprise. And we want to work with the financial industry to achieve that end. But the old ways that led to this crisis cannot stand. And to the extent that some have so readily returned to them underscores the need for change and change now. History cannot be allowed to repeat itself.
Instead, we are calling on the financial industry to join us in a constructive effort to update the rules and regulatory structure to meet the challenges of this new century. That is what my administration seeks to do. We have sought ideas and input from industry leaders, policy experts, academics, consumer advocates, and the broader public. And we've worked closely with leaders in the Senate and House, including Senators Chris Dodd and Richard Shelby, and Congressman Barney Frank, who are now working to pass regulatory reform through Congress.
Taken together, we are proposing the most ambitious overhaul of the financial system since the Great Depression. But I want to emphasize that these reforms are rooted in a simple principle: we ought to set clear rules of the road that promote transparency and accountability. That's how we'll make certain that markets foster responsibility, not recklessness, and reward those who compete honestly and vigorously within the system, instead of those who try to game the system.
First, we're proposing new rules to protect consumers and a new Consumer Financial Protection Agency to enforce those rules. This crisis was not just the result of decisions made by the mightiest of financial firms. It was also the result of decisions made by ordinary Americans to open credit cards and take on mortgages. And while there were many who took out loans they knew they couldn't afford, there were also millions of Americans who signed contracts they didn't fully understand offered by lenders who didn't always tell the truth.
This is in part because there is no single agency charged with making sure it doesn't happen. That is what we'll change. The Consumer Financial Protection Agency will have the power to ensure that consumers get information that is clear and concise, and to prevent the worst kinds of abuses. Consumers shouldn't have to worry about loan contracts designed to be unintelligible, hidden fees attached to their mortgages, and financial penalties whether through a credit card or debit card that appear without warning on their statements. And responsible lenders, including community banks, doing the right thing shouldn't have to worry about ruinous competition from unregulated competitors.
Now there are those who are suggesting that somehow this will restrict the choices available to consumers. Nothing could be further from the truth. The lack of clear rules in the past meant we had innovation of the wrong kind: the firm that could make its products look best by doing the best job of hiding the real costs won. For example, we had "teaser" rates on credit cards and mortgages that lured people in and then surprised them with big rate increases. By setting ground rules, we'll increase the kind of competition that actually provides people better and greater choices, as companies compete to offer the best product, not the one that's most complex or confusing.
Second, we've got to close the loopholes that were at the heart of the crisis. Where there were gaps in the rules, regulators lacked the authority to take action. Where there were overlaps, regulators often lacked accountability for inaction. These weaknesses in oversight engendered systematic, and systemic, abuse.
Under existing rules, some companies can actually shop for the regulator of their choice - and others, like hedge funds, can operate outside of the regulatory system altogether. We've seen the development of financial instruments, like derivatives and credit default swaps, without anyone examining the risks or regulating all of the players. And we've seen lenders profit by providing loans to borrowers who they knew would never repay, because the lender offloaded the loan and the consequences to someone else. Those who refuse to game the system are at a disadvantage.
Now, one of the main reasons this crisis could take place is that many agencies and regulators were responsible for oversight of individual financial firms and their subsidiaries, but no one was responsible for protecting the whole system. In other words, regulators were charged with seeing the trees, but not the forest. And even then, some firms that posed a "systemic risk" were not regulated as strongly as others, exploiting loopholes in the system to take on greater risk with less scrutiny. As a result, the failure of one firm threatened the viability of many others. We were facing one of the largest financial crises in history and those responsible for oversight were caught off guard and without the authority to act.
That's why we'll create clear accountability and responsibility for regulating large financial firms that pose a systemic risk. While holding the Federal Reserve fully accountable for regulation of the largest, most interconnected firms, we'll create an oversight council to bring together regulators from across markets to share information, to identify gaps in regulation, and to tackle issues that don't fit neatly into an organizational chart. We'll also require these financial firms to meet stronger capital and liquidity requirements and observe greater constraints on their risky behavior. That's one of the lessons of the past year. The only way to avoid a crisis of this magnitude is to ensure that large firms can't take risks that threaten our entire financial system, and to make sure they have the resources to weather even the worst of economic storms.
Even as we've proposed safeguards to make the failure of large and interconnected firms less likely, we've also proposed creating what's called "resolution authority" in the event that such a failure happens and poses a threat to the stability of the financial system. This is intended to put an end to the idea that some firms are "too big to fail." For a market to function, those who invest and lend in that market must believe that their money is actually at risk. And the system as a whole isn't safe until it is safe from the failure of any individual institution.
Tabacco: Corporate America & the GOP want BUSINESS DEREGULATION and Consumers WITHOUT Legal Advice! It’s not just the CFPA but those ARMs, etc etc.
Corporations can afford to hire the best lawyers and Madison Avenue Propaganda (PR) firms. Corporations can even afford to finance Front Groups and Think Tanks, while passing those costs onto you, the Consumer. But let anybody suggest a Consumer Protection Agency, and they cry “UNFAIR! Big Brother Protecting You To Death!”
What has Randazzo’s mama story above to do with the CFPA? Nothing! Why not? Because he deliberately did not make the CONNECTION!
In his driving story he says, “The only problem was that I needed both arms free to keep the van from crashing in the first place.” But in his alleged parallel about CFPA he merely says, “Which is the same attitude every American should have when it comes to the new consumer financial protection laws President Barack Obama and Rep. Barney Frank (D-Mass.) want to impose on businesses.” That is not a CONNECTION or a REASON; that is PROPAGANDA! You are supposed to supply your own raison d’etre or worse - you must assume Randazzo already supplied a connection, which he didn’t! See how SOPHISTS RELY ON YOUR IGNORANCE & MENTAL LAZZINESS!
“But it has come under considerable attack recently for fear it would smother businesses and end up hurting consumers.” - How would or could it “hurt consumers”? He never tells us! Worse, he says, “for fear it would smother businesses and end up hurting consumers”. How’s that for saying nothing while pretending to inform!
If by smothering “businesses”, he means forcing them to be honest and not mislead Consumers, that is not a negative but a POSITIVE! So as that old burger commercial asked rhetorically, “WHERE’S THE BEEF!”
Corporate America wants you to be a GULLIBLE CONSUMER! Doubt my claim? Then turn on your TV and just watch nothing but the commercials! They prove my point - at least if you are not proselytized so much you actually believe that a beer label that turns BLUE when cold is more important than taste, nutrition and cost of the beer itself!
How dumb do we have to be to buy into the Sophistry that a Consumer Protection Agency is “Big Brother” and to be feared! If George W. Bush had proposed it, that fear would have been justified! But he didn’t - a Democratic President did! That’s how I knew Clarence Thomas was no good for Blacks - he was nominated by a Republican president! Sorry, folks, but that System WORKS, and it works almost all the time!
If someone gives you wrong suggestions all the time, that person is just as reliable as someone, who gives you correct suggestions all the time. That’s known as NEGATIVE CORRELATION. All you need do is go against their advice all the time!
http://www.politico.com/news/stories/0909/27136.html
Obama boosts consumer agency proposal
By: Victoria McGrane
September 14, 2009 02:56 PM EST
President Barack Obama Monday fiercely defended one of the most controversial elements of the administration’s new rules for Wall Street, the creation of a new consumer watchdog for credit cards, mortgages and other financial products.
Known as the Consumer Financial Protection Agency, the new consumer agency was the first specific policy proposal Obama mentioned in his speech to the financial industry at Federal Hall in Manhattan.
He took financial industry critics who claim it would actually restrict consumer choice and make it harder for people to get credit.
“Nothing could be further from the truth. The lack of clear rules in the past meant we had innovation of the wrong kind,” Obama said, arguing that financial firms competed over which could do a better job tricking consumers into buying poorly understood products.
“By setting ground rules, we’ll increase the kind of competition that actually provides people better and greater choices, as companies compete to offer the best product, not the one that’s the most complex or confusing.”
Obama’s continued support for the CFPA comes at a critical time for the proposal. On the House side, moderate Democrats remain uneasy about the scope and power of the proposed watchdog, and their concerns have helped delay a mark up on legislation.
In the Senate, Banking chairman Chris Dodd is negotiating with a skeptical ranking Republican, Sen. Richard Shelby of Alabama.
But Obama’s speech didn’t quell criticisms from key opponents.
“The so-called Consumer Financial Protection Agency would in fact be a massive and expensive new government bureaucracy that, in the name of consumer protection, would ration credit and allow fewer financial choices for consumers,” said Rep. Spencer Bachus (R-Ala.), the top Republican on the House Financial Services panel.
President Obama was deliberately vague on that issue. I know why!
First, it is extremely difficult to expunge a government agency, once established and funded. That Republican argument is valid! I knew if I looked hard enough and long enough I would eventually find a Republican-Conservative Truth. And, even though self-serving, that assertion is true.
Knowing that and the fact that GOPers will oppose ANYTHING OBAMA, we already have opposition from the GOP for the very thing to which they always give LIP SERVICE – SMALLER GOVERNMENT!
Had the President promised to replace all those other agencies, he would have been promising something he could not guarantee to deliver. Hell, he may be unable to deliver the CFPA!
Tabacco: I consider myself both a funnel and a filter. I funnel information, not readily available on the Mass Media, which is ignored and/or suppressed. I filter out the irrelevancies and trivialities to save both the time and effort of my Readers and bring consternation to the enemies of Truth & Fairness! When you read Tabacco, if you don’t learn something NEW, I’ve wasted your time.
Tabacco is not a blogger, who thinks; I am a Thinker, who blogs.
In 1981's 'Body Heat', Kathleen Turner said, "Knowledge is power".
T.A.B.A.C.C.O. (Truth About Business And Congressional Crimes Organization) – Think Tank For Other 95% Of World: WTP = We The People
OPEN MEMO TO ANTHONY RANDAZZO & OTHER REPUBLICANS!