Paulson's Financial Overhaul

Treasury Secretary Hank Paulson announced a massive overhaul of the financial regulatory bodies in the U.S. Although I haven't studied all of the specifics, my initial reaction is pretty positive. Most of the overhaul deals with how the agencies regulate banks, thrifts, the exchanges and other financial institutions.

One of the biggest changes is the elimination of the Office of Thrift Supervision (OTS), which will be rolled into the Office of the Comptroller of the Currency (OCC), regulates U.S. banks. The OTS has generally had more lax regulations that the OCC, so some thrifts (primarily mortgage lenders) such as Washington Mutual might suffer from tighter regulations.

More importantly, some Democrats seem to be complaining that the government is "doing enough," which means (hoepfully) that we are not facing regulatory overkill.