http://www.themotherhood.com/post/show/id/434050 en-US
My biggest recommendation is that all members of congress, and all American High School students obtain an education about supply and demand, using capital to start a business, interest and loans, balancing a checkbook, and making a budget for buying a big ticket item in the future.

"Those greedy wall-street guys" can't take advantage of us if we're educated. And if we don't let them over-leverage, many of the systematic risks decrease.

Secondly, regulations and new organizations often have unintended consequences. Take the FDIC. What it means to most of us is "If I put my money in this bank, even if the bank fails, I can get my money back again."

What it means to the bankers is, "I can get a low-interest or no-interest loan from thousands of consumers that other companies just can't get." Deposit insurance encourages banks to over-leverage, spending that money we've loaned them foolishly on high-risk high-reward investments, because they don't have to pay as much interest as another company that has to issue bonds to consumers and promise to pay those bonds back at 4, 5, even 7% interest.

Don't get me wrong, I don't want to get rid of the FDIC, but I think we should look at the unintended consequences of "protecting consumers" on the other side. For starters, I think FDIC insurance premiums should be based not only on the dollar amount insured, but on a bank's mark-to-market leverage ratio. That's a change I can stand behind.

Making a whole new national institution to protect consumers -- I don't think so. I think there will be too many unintended consequences. Educate consumers. Don't protect them in this way.

There will always be greed. There will always be unscrupulous people working in industry. If someone wants to mug me and steal my purse, no regulatory body in the world will stop them. Only their mother's voice inside their head can stop them. The little voice that says, "It's wrong. Don't do it. I know it's hard. Do the right thing because I believe in you."

The government can only teach, "Don't get caught."

Educate. Support morals. Support mothers.

Thank you,
--Beth]]> webmaster@themotherhood.com (BethLeonard) Tue, 13 Oct 2009 01:04:22 -0400 http://www.themotherhood.com/post/show/id/434050 http://www.themotherhood.com/post/show/id/434050

1. What effect will the proposed Consumer Financial Protection Agency (CFPA) have on current regulatory agencies? Will regulators and rules be consolidated under this new umbrella? Which agencies in particular will be moved? How long will it take to streamline the process? How will overlapping regulations or loopholes be closed if contradictions exist?

2. Which, if any, provisions will be put in place under this new agency to protect those Americans who practice fiscal responsibility? In other words, which specific provisions will be put in place to make it more lucrative for financial institutions to conduct honest business with financially responsible clients rather than what they can stand to gain by exploiting those who are in desperate financial situations?

Amie Adams lives in Springfield, VA. She is a married mom of three boys. Both Amie and her husband Greg work full-time as consultants in the DC area. They have been saving for their sons' education since each was born and yet are still concerned about how they will pay for three sets of college expenses after the latest problems in the market. Amie blogs about parenthood, politics and her creative ventures at Mamma Loves... (http://mammaloves.blogspot.com)]]> webmaster@themotherhood.com (MammaLoves) Mon, 12 Oct 2009 18:36:27 -0400 http://www.themotherhood.com/post/show/id/434050 http://www.themotherhood.com/post/show/id/434050