A major revamp of the regulation of financial markets is reportedly in Democrat’s immediate plans. The WSJ reports that House Financial Services Chairman Barney Frank said in an interview that
a central point of Democrats’ plans would be the creation of a “systemic-risk regulator.” It could have unprecedented powers over a wide range of financial institutions, from insurance firms to hedge funds, with responsibility for protecting the soundness of the whole financial system, not just one sector. He likened that to the establishment of the Securities and Exchange Commission, charged with maintaining fair markets and investor protection, five years after the market crash of 1929.
The article also quotes Sen. Charles Schumer as stating that Congress would try to redraw supervision of financial markets completely in the first six months. “Whether the economy was in tatters or not, we need a new system of regulation,” he said.