Here are some of the key provisions of President Obama’s proposals to increase regulation of the nation’s financial system and prevent another economic crisis:
■ Create a Consumer Financial Protection Agency to ensure consumers are treated fairly and can get sound information about mortgages, credit, savings, and other types of financial services.
■ Establish standards for executive compensation; give the Securities and Exchange Commission power to require shareholder votes on salaries and bonuses.
■ Subject hedge funds to regulations for the first time, forcing them to register with the SEC and disclose enough information to assess their financial stability.
■ Tighten rules for derivatives trading, including markets in credit default swaps, and increase transparency; boost regulation of the credit rating agencies that judge the risks of such investments.
■ Expand the powers of the Federal Reserve to regulate risk and set cash reserve requirements at all major financial institutions, including Wall Street investment houses, not just banks.
■ Give the government powers to take control of large financial firms, not just banks, when they face insolvency.