Very detailed overview of The Dodd-Frank Wall Street Reform and Consumer Protection Act

[jenmito]

Read it and learn something: http://www.weil.com/files/upload/Weil%20Dodd-Frank%20Overview.pdf :thumbsup:

[Spazito]

1. Thanks! At first glance this looks to have very good info in it on the details...

timelines, etc.

Recommended.

[jenmito]

2. Yup...

it sure has a lot of information to absorb! I still await criticism from the "usual suspects."

[zipplewrath]

3. It is a regulatory bill

Much of the bill relies upon regulations that have not been written yet. It will be in the regulations that the success or failure of this bill will reside. It will expose the rules to constant manipulation by lobbyists. It may be successful anyway.

[Spazito]

4. I agree, the success will be determined by the regulations that are to be written...

from within the framework set out in the legislation. It is not perfect, by any means, but it is, imo, a concrete improvement from the status quo.

I will be watching with great interest to see the regulations that will be adopted throughout the stipulated timeline.

[zipplewrath]

18. I'm ambivalent

It's a change from the status quo. But several analysis of the bill suggest that it wouldn't have really changed much about the most recent crisis, other than having given the government the ability to take over the institutions and dismantle them. But we still would have been on the hook for huge losses.

A big part of what you think about this bill will rest on 2 very large issues.

1) Although they'll have the authority to break up institutions, will they? Everyone points to the FDIC, but the VAST majority of banks they deal with are regional and relatively "small" (in their economic sense). Off the top of my head I can't think of a national bank that the FDIC has come in and shut down. The political/economic drama of shutting down an AIG or a Goldman is extreme, and international to some extent. I am reminded of a metaphor that someone once used. Aerobatic aircraft are required to have parachutes that the pilot wear. They rarely get used however. Not because they don't work, or because planes don't crash. They don't work because the pilots won't decide to "give up" and go to the parachute until it's too late for it to be used. Would a republican administration "take down" a large, international, institution that might affect the economies of several G20 countries, or would they wait until it was "too late" anyway.

2) Consumer Protection. In the right hands, it can be powerful. But we have several agencies that are suppose to do such things, everything from the FCC to the FDA. The history of their "protection" isn't always that great. Much of the power this new agency is being given already existed in some form or another with either Congress itself or with the Fed. There was an extreme unwillingness to exercise it. In the out years, I don't see that changing much. Too much money to be made in ripping off the consumers. Too many campaign contributions to be had.

As I say, it is a change from the status quo, and what we had was effectively unacceptable. I'm not sure why we just couldn't go back to Glass Steagall. And that makes me skeptical. The proof will be in the out years. Far too soon to call this "historic".

[Spazito]

24. I always take a look at the analyst/s before deciding to trust their analysis...

It is too often found that the analyst/s started from a premise already formulated in their minds and tailor their analysis to back up that pre-formed premise. Analysis of that kind are, imo, no different than media talking heads in that they have an agenda, a message to impart and are far from neutral on the substance of the issue/bill/legislation, etc.

It is, imo, historic in that it re-introduces regulations into a system that was, equally historically, again, imo, de-regulated by the Clinton administration with the passage of the Gramm-Leach-Bliley act of 1999.

One was historic in it's de-regulation of the financial industry, the other in the re-regulation of said industry.

We now know how destructive the historic de-regulation was and, imo, re-regulating is certainly the way to go.

The devil is in the details and it will be interesting to debate those 'details' ie regulations as they come forward.

[DCBob]

5. I wish this could be boiled down to some simple bullets that the ignorant masses could understand.

One look at this and a Faux Newzer type will say "Too many pages!".

[jenmito]

7. True...

FinReg for Dummies. :)

[DCBob]

8. HA!!

nice! :)

[jenmito]

10. Thanks.

:D

[Spazito]

12. I think rather than trying to whittle it down to simple bullets...

which, with a piece of legislation like this, is nearly impossible to do because of the explanations needed that go beyond the bullet point for the average reader to understand, it would be more beneficial if there were a breakdown of each critical aspect of the legislation published/posted separately which would, imo, make it understandable in bite size portions. Here's an example of what I am thinking:

Orderly Liquidation Authority (§§ 204 & 205) (The Too Big To Fail Fix - my addition)


"Congress has acknowledged that some financial firms are going to fail, notwithstanding the intricacies of the framework it has designed to regulate and supervise systemically important companies as ongoing entities. During the financial crisis and in its aftermath, a number
of policymakers formed the view—despite evidence to the contrary—that the US Bankruptcy Code and the judicial
process it entails are ill-suited to govern the resolution of systemically important institutions that become insolvent.

As a direct result of that view, the legislation establishes a new mechanism, based largely on the FDIC’s resolution process, for the liquidation of systemically important financial companies. That class of company will include those entities regulated by the Council and the Federal Reserve under the systemic risk regime outlined above, as well as any financial company whose imminent failure may have considerable adverse ramifications for the US financial system. This new mechanism is called the Orderly Liquidation Authority (Liquidation Authority). The US Bankruptcy Code will continue to apply to most financial companies, except those posing a systemic risk. In those cases, the new Liquidation Authority will preempt the bankruptcy process and permit the FDIC to seize control of the entity and proceed to liquidate it, rather than allowing the company and its creditors to work out restructuring arrangements as permitted under the US Bankruptcy Code. As a consequence of the legislation, lenders, rating agencies, and other counterparties will need to consider the different
effects of the US Bankruptcy Code and the Liquidation Authority on those financial firms whose failure might pose a systemic risk."

My take on this:

Congress, after seeing the near melt-down of the financial system due to the 'too big to fail' financial institutions, put in place a new mechanism, called the Orderly Liquidation Authority, which will pre-empt the bankruptcy process for those institutions whose failure poses a systemic risk (meaning those institutions whose imminent failure may cause considerable damage to the US financial system as a whole).

This new mechanism can seize control of that institution and liquidate it instead of the usual 'restructuring arrangements' which, as we know worked so well recently - not.


** Okay, that was my example, not sure if it was helpful as it was not as complete as I would see each breakdown be, both with the 'bureaucratic explanation' and the layman's take of it.

** The sections in quotes were taken directly from the article in the link in the OP and anything in brackets are my words.

[DCBob]

13. Sounds good to me..

but I think you need some flashy cartoons to help keep their attention.

[Spazito]

14. LOL, all out them I'm afraid! n/t

[Dawgs]

25. Disagree; the ignorant public needs only see that the Dems tried; and the GOP blocked AGAIN!!

They wouldn't see the bullet points anyways.

[Beetwasher]

6. Solid Beginning

n/t

[stevenleser]

9. K&R ;-)

[jenmito]

11. Thanks! :)

[stevenleser]

26. Kick

[jenmito]

15. Kick for someone else to R. :)

[Political Tiger]

16. K & R ! :)

[yowzayowzayowza]

17. K&R

Thx for the link!!!

:hi:

[NJmaverick]

19. K & R!

[jenmito]

20. kick

[treestar]

21. K&R

:kick:

[impik]

22. One big sell out

Even DUs said so...

[firedupdem]

23. K&R n/t

[Cha]

27. THanks jenmito~ nt

[jenmito]

28. No problemo! n/t

[Peacetrain]

29. 26 pages.. thank you for providing the link..

Thanks Jen.. I was going to try and track this down later.. you saved me a ton of time :thumbsup:

[Spazito]

30. Here is a link to a set of slides laying out the bill in really clear terms...

http://www.davispolk.com/files/Publication/bc70cd4c-c6bd-472d-ad37-0a63481fe36a/Presentation/PublicationAttachment/6a2f81d8-d5c5-4d5d-9b97-fef48b6821e6/070910_Implementation_Slides.pdf

I am someone who can absorb details such as those in the bill if they are laid out visually as well as by text so I found the slides to be an excellent resource.

The slide link was provided in an OP by ProSense in this thread:

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=433x377478

[madinmaryland]

31. Thanks! I bookmarked for later reading.

K&R, also.