Obama to fight for new financial agency

Obama to fight for new financial agency

“These interests argue against reform even as millions of people are facing the consequences of this crisis in their own lives,” Obama said in a weekly radio address.“These interests defend business-as-usual even though we know that it was business-as-usual that allowed this crisis to take place.”

Obama said opponents were already “mobilising” against his proposal earlier this week to create a new Consumer Financial Protection Agency as part of the most sweeping set of financial regulatory reforms since the 1930s. The new agency, which the Congress would have to approve, would have the power to write rules and design or ban financial products. It could also examine firms and impose fines and other penalties on almost any institution that offers products such as home loans or credit cards.

Critics argue that the new agency would stifle financial product innovation, boost the cost of regulatory compliance and cause prices for consumers to rise.

“It’s going to create exactly the type of duplication, second-guessing and layering that we feared,” David Hirschman, US Chamber of Commerce’s Center for Capital Markets President, said earlier this week.

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