On Thursday, some of the nation’s top lawmakers released a plan to help bolster the economy by proposing a broad series of reforms aimed at tightening oversight of financial institutions. This is a plan that should have been in place from day one.  It is kind of like locking the barn door after the horse has been stolen, don’t you think?  Tougher disclosure requirements for banks and Wall Street firms, a nationwide licensing system for mortgage brokers and new rules for credit rating agencies are part of the agenda.  One would think that these safeguards would already be in place, but it is obvious by the state of the economy and the huge debacle in the mortgage market that this just isn’t so.

Lawmakers are doing everything they can to stay away from the dreaded word “bailout”.  It is understandable - even I feel that it is not up to the government and the American taxpayers to bail out people who made bad choices.  This not only includes homeowners, but lenders and Wall Street banks alike.  Tonight the NBC Nightly News reported that Bear Stearns is in the crapper, and looking for a bailout.  The consensus seems to be that they will be helped out.  That is okay, I suppose, but the reasoning behind that doesn’t sit well.  The fear is that if allowed to go under, the fallout from this could further hurt the economy.  So, instead, we see the government and other agencies giving Bear Stearns a handout.  Nice.

The Treasury Secretary, the chairman of the Federal Reserve and the government’s top financial regulators, have come up with the plan.  Led by Paulson, it is hoped that “greater transparency” and stronger risk management will be the watchwords of their proposal.  It appears to me that they are a day late and a dollar short.  Once again, we take a wait and see attitude.