I’ve been reporting on the new proposals from House Financial Services Committee Chairman Barney Frank that he put forth in a news conference this morning. A lot of it is very complicated and has to do tighter regulations of capital markets and investment banks.
The first proposal from Chairman Frank is to “Consider establishing a financial services systematic risk regulator.” Ok, what’s that? Some kind of regulatory body--maybe the Fed, maybe not--that has “the capacity and power to assess risk across financial markets regardless of corporate form and to intervene when appropriate.”
The idea is to limit risky practices, many of which got us into all the trouble we’re in now. Risk assessment, or lack thereof, brought down the credit markets last August.
What’s so interesting to me is that in an interview in the 10 am hour on "Squawk on the Street," when questioned about this clearly controversial idea, Frank immediately backed off. He kept saying, “We’re just considering it” and “We’re not rushing into anything.”