Financial Non Reform

The latest work product emanating from Washington in the form of the 2300 page Financial Reform bill is now law. Only it does very little to actually reform but rather delivers more power to the very regulatory bodies that failed us in 2007-2008. A great deal has been written about the evil large Wall Street bankers and indeed some of that is justified particularly when it comes to protecting clients and acting in their best interests . Not as much has been written (I looked but could not find a suitable piece to link here) about the abject failure of the existing regulatory regime including many in Congress who crafted this new law.

So, how will it impact markets? No one knows as there will be unintended consequences on virtually every page that likely will outweigh any possible good in the law. What we do know, is Fannie and Freddie are still out there with an unlimited checkbook yet virtually worthless (both were de-listed from the NYSE recently as their stock prices are well under $1/share). Eventually, this is a problem that will have to be solved . Given all of the headwinds from the "legislate by the pound" crowd in Washington, the markets have been quite resilient . Stay tuned.