Below I’ve highlighted the six points of Geithner’s plan. (Read LA Times article here.)
The key elements of the Obama administration’s proposals are:
• Give a single government entity, possibly the Federal Reserve, the power and authority to oversee the entire economy for signs of “systemic risk.”
• Establish a government mechanism to seize and dismantle large institutions whose failure threatens the nation’s financial stability.
• Enact tougher requirements for the amount of money and assets financial institutions need to have on hand so they can withstand economic troubles.
• Require large private investment funds to register with the Securities and Exchange Commission.
• Set up a new, comprehensive framework of regulation of the complex financial instruments known as derivatives, including a central clearinghouse for trades in that market.
• Develop new, stronger requirements for money market funds so increased withdrawals won’t threaten the broader financial system.
“What we need is better, smarter, tougher regulation,” Geithner said.
So… do you think these points are better, smarter, and tougher?