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SUNDAY, NOVEMBER 8, 2009
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Obama Proposes More Powerful Fed

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(Newser) – President Obama today proposed broad new powers for the Federal Reserve and the creation of new national regulator to ensure against another financial crisis, the Wall Street Journal reports. Under the new plan, the Fed would oversee all components of any banking concern, even its foreign affiliates, and Treasury would have the power to take over and restructure any company. Obama called it a “sweeping overhaul.”

Obama proposed dismantling the Office of Thrift Supervision in favor of a more centralized regulatory approach that would be harder to sneak around. He also wants hedge funds to register with the Securities and Exchange Commission, and proposes a catchall council to “tackle issues that don't fit neatly in an organizational chart.” The plan as written, with its generous increase in federal powers, is likely to face stiff opposition in Congress.

President Barack Obama concludes his remarks on the new comprehensive regulatory reform plan.
President Barack Obama concludes his remarks on the new comprehensive regulatory reform plan.   (AP Photo)
President Barack Obama delivers remarks on the new comprehensive regulatory reform plan.
President Barack Obama delivers remarks on the new comprehensive regulatory reform plan.   (AP Photo)
The Federal Reserve building.
The Federal Reserve building.   (AP Photo)
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We are called upon to recognize that the free market is the most powerful generative force for our prosperity—but it is not a free license to ignore the consequences of our actions. - President Obama

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13 comments
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Graymatter
Jun 17, 09 1:41 PM CDT
Even in the best of intentions, the Fed is the last group on the Earth who needs to have any more influence or control over anything. They are a parasite on our money supply. They grow ever fatter of American's wealth as they drain away our monetary freedoms. Surely there has to be a better monetary policy then what we have today. Reply
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IN RESPONSE:
freethemall
Jun 17, 09 1:48 PM CDT
The Federal Reserve system was established in answer to a need. Would you have us go back to the way it was? Or let's hear your brilliant ideas for how it ought to be.
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+1
IN RESPONSE:
Graymatter
Jun 17, 09 4:04 PM CDT
The federal reserve was establish with the federal reserve act, sure, we needed a currency, and for a long time they did their jobs well. But look what we have now, thanks to the fed, a dramatically weakened dollar thanks to inflation and debasing, a fractal reserve currency system that is designed to keep the US government permanently in debt. Ever wonder how a dollar is created and where it gets it's value? Poof they create it out of thin air and give it a value, you can't possibly tell me this is the way a monetary system should function and that there are no better philosophies of money to follow. I don't have a better idea, but I certainly know enough to know that THEY don't have the right one.
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-2
IN RESPONSE:
Snowleopard
Jun 17, 09 5:34 PM CDT
Being able to control the money supply is one of the few things that keeps capitalism somewhat stable (in normal times at least). During times of high unemployment, they lower interest rates to encourage investment and growth, while during times of inflation they raise interest rates, contracting the money supply, which controls inflation. I don't think any mainstream economist out there would really advocate doing anyway with this kind of monetary policy. I do however think that the Fed was foolish under greenspan for keeping interest rates too low for too long because it exaggerated the size of the bubble... and it would be nice if the fed wasn't partly a private organization.
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IN RESPONSE:
OriginalMike007
Jun 18, 09 2:02 AM CDT
Imagine that Obama gave me oversight of all your assets foreign or domestic. If I didn't like how you were running your life I could just take it over and restructure it. This is ridiculous beyond measure. People talk about socialism and the police state THIS IS IT. You're next.
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