Dodd Frank Wall Street Reform Failure

A survey of 37 economists conducted by the University of Chicago in 2014, for example, found that nearly all believed that without the stimulus, the unemployment rate would have risen higher than it did.” In addition to this, President Obama strategized new regulations to protect consumers and to prevent another financial crisis. In 2009 and 2010, he signed the Credit Card Accountability Responsibility and Disclosure Act, the Dodd-Frank Wall Street Reform and the Consumer Protection Act into law. The CCARD Act restricted and obligated interest rates on credit card companies and obligated them to enact transparent policies. The Dodd-Frank created the Financial Stability Oversight Council and the Consumer Financial Protection Bureau which could disintegrate banks if it was possible to fail for any reason including but not limited to subprime loans.

On July 21, 2010, President Obama signed the Dodd-Frank Wall Street Reform and Consumer Protection Act, which is commonly referred as the Dodd-Frank Act. This act was passed as a response to the Great Recession in order to prevent potential financial debacle in the future. This regulation has a significant impact on American financial services industry by placing major changes on the financial regulation and agencies since the Great Depression. This paper examines the history and impact of Dodd-Frank Act on American financial services industry.

In the wake of the 2008 financial crisis, a Democrat Congress and President Barack Obama passed the Dodd-Frank Act, which in turn unleashed a flood regulations and created the CFPB. While their intent of protecting the little guy is praiseworthy, the legislation had the opposite effect. Since its inception, the CFPB became

The Dodd-Frank Wall Street Reform and Consumer Protection Act is a mammoth part of financial reform legislation passed by the Obama presidential term in 2010 as a reaction to the financial crisis of 2008. The act's many provisions, implied out over thousands of pages, are scheduled to be taken over a point of several years and are intended to decrease various risks in the U.S. fiscal system. The act established a number of new government agencies tasked with supervision over various components of the act. There are so many provisions, such as financial stability, orderly liquidation authority, transfer of power to comptrollers, FDIC and Fed, Hedge funds, insurance, pay it back Act, and Etc, which contribute to better department and regulations.

the causes that led to the 2008 crisis. They view Dodd-Frank as a comprehensive and powerful

The Federal Deposit Insurance Corporation (FDIC) is a government corporation that was established by Congress in 1933. On June 16, 1933, President Franklin Roosevelt signed an Act known as ‘The Banking Act of 1933. The act was created during the Great Recession in order to restore the trust of the public in the American banking system, due to the fact of how frequent bank runs were happening. A bank run is a result of so many people demanding to withdrawal their deposits from the Bank’s reserves, that it leads to the banks becoming insolvent and not being able to return their depositor’s money, which lead to many banks filing for bankruptcy. During this time thousands of banks failed and because of this many people lost faith in the American

Financial regulators and politically motivated critics of bad credit loans have proposed many regulations that target payday-style loans such as requiring greater due diligence in processing the loans, limiting interest rates and simply banning the loans in certain states. However, the government's own Federal Deposit Insurance Corporation released a national study in October of 2014 that found about 34 million households don't participate in the banking system. These people depend on alternative financial resources like check cashing companies, bad credit loans and payday and title loan

The Glass Steagall Act was passed on 1933, which is also known as The Banking Act to tighten regulation on the way banks did their business. This act was written as an emergency measure when about 5,000 banks failed during the Great Depression. Banks mostly failed because of the way they would invest with money. The act prohibits banks from investing money on investments that turn out to be risky. Banks could no longer sell securities or bonds. The act also created Federal Deposit Insurance Corporation (FDIC) to protect the deposits of individuals, which is still used to this date. The FDIC in this era insures your deposits in your bank up to $250,000. This gave the public confidence again to deposit their money in the bank. In 1933

people's need for extra funding has led to the extension of credit to large segments of the population who were previously deemed unqualified. However, some lenders have tried

The Consumer Financial Protection Bureau was created in 2010 as a response to the financial crisis of 2008. The government agency was established by the Dodd-Frank Act which President Barack Obama passed as a means of controlling and preventing excessive risk-taking ("Wall Street Reform: The Dodd-Frank Act"). The financial crisis occurred in part because of the limited regulation of financial institutions and the wave of irresponsible mortgage lending (The Economist). Subprime borrowers with poor credit histories and insufficient funds for repaying the loans were allowed to borrow money which they could not pay back, thus in turn initiating a nationwide housing market crash (The Economist). Many of these borrowers were granted these loans because of the poor judgement of banks and financial institutions, thus the government needed to create an institution which would protect consumers against unfair and deceptive practices. The mission of the Consumer Financial Protection Bureau is just that-to protect consumers in the financial marketplace by enforcing federal consumer financial laws (CFPB, 2016). In order to achieve this, the bureau monitors the financial market for potential risks to consumers and supervises companies in order to uncover institutions practicing abusive and fraudulent acts. Developing laws to create a fair market place is a top priority of the bureau, as it works to enforce these rules and regulations and make them more effective. The agency also conducts

The financial crisis of 2007-2008 was one of the worst economic downturns the United States has faced since the Great Depression of the 1930s. It affected the banking industry by causing banks to squander money on mortgage defaults, bringing interbank lending to halt, as well as affecting credit being provided to consumers. Another effect was that it caused certain businesses to essentially run out or come to an end. Many companies had to take advantage of bailouts, but the economic was still in disarray. The financial crisis also affected the country in the long-term by bringing about new regulatory programs such as Dodd-Frank Wall Street Reform and Consumer Protection Act (Singh, 2015).

(Danzer)Also, the “Glass-steagall Act” in 1933 provided insurance for individual banks to make sure the customers’ money was in a safe place. (Danzer) The “Fair Labor standards Act” in 1938 limited the working hours and the working age for the entire country. (Danzer)This was the same in 2008, when the government favored public safety,which by published “The consumer protection act”by giving consumer protection at different area like bank and house market.Obama also introduced a new financial regulatory system. "(Securities)Then,The CFPB was an agency of U.S. government produced in 2010. It also provided protection in the financial system, make sure the money consumers invest will be back. The agency include banks, credit unions, mortgage department and many other debt companies in the United States.(“Consumer”) All in all, after the crisis, government realized they can’t hands-off anymore, they have to step in and protect the public safety since the whole economic system gone

Obama used his legislative power after the he fall of 2008 when a financial crisis of a scale and severity not seen in generations left millions of Americans unemployed and resulted in trillions in lost wealth. To make sure that the economic crisis of 2008 did not happen again, Obama attempted to develop a policy that would hold Wall Street accountable and protect American families from unfair, abusive financial practices. President Obama signed a policy using his legislative power, known as the Dodd-Frank Wall Street Reform and Consumer Protect Act. The Dodd-Frank Wall Street Reform and Consumer Protect Act was signed to prevent the excessive risk-taking that can led to the financial crisis. The law also provides common-sense protections for American families,

The payday advance industry has received a great deal of criticism in recent years. Celebrities such as Sarah Silverman have publicized their opinions of payday loans, and President Obama has called payday advances "predatory." In June, the Consumer Financial Protection Bureau, commonly called the CFPB, released its long-awaited proposed regulations for payday advances and other short-term loans. Despite the vocal attacks on payday loans, a strong argument can be made in favor of leaving the payday advance industry alone.

Inside Job is a documentary that covers the 2008 financial crisis. The first part of the documentary focuses on what led to the financial meltdown. In the 1980 's the finance industry exploded after investment banks went public, leading these firms to have an excess of stockholder 's money. Then the president at the time, Ronald Reagan, began a 30 year period of financial deregulation. Reagan deregulated savings and loan companies which allowed them to make risky investments with depositor 's money, which led to taxpayers paying $124 billion dollars when they inevitably failed. Executives in these companies were also stealing money from their depositors. Another problem was that many of the executives from these investment banks ended up being put into powerful positions in the government where they pushed for even more deregulation. In the late 90 's the internet bubble burst after investment banks knowingly promoted internet companies they knew would fail. A financial innovation known as derivatives became a $50 trillion business yet they were completely unregulated. When there was an attempt to regulate this market, it was almost immediately shut down and a law was put in place banning all regulation of derivatives. Under these new rules it created a new securitization food chain. Investment banks were creating complex derivatives called collateralized debt obligation and selling these debts to investors. Then these CDO 's were rated by rating agencies, with most of them