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Obama signs financial reform bill

By Sheyna Steiner · Bankrate.com
Wednesday, July 21, 2010
Posted: 1 pm ET

Cue the triumphant fanfare, today President Obama signed the Dodd-Frank Act into law.

Whether that signals a new era of consumer protections or a leaden regulatory morass depends on your perspective but hopefully consumers will find themselves being trampled by Wall Street and big banks a little less regularly.

In his remarks during the signing ceremony, President Obama made it clear that consumer protections were the aim of the financial reform, in that, "every American, from Main Street to Wall Street, has a stake in our financial system."

Though many of the reforms won't go into effect for some time, there are some immediate changes that should take place, says Jennifer Liberto, a senior reporter with CNNMoney.com.

In the story "Wall Street reform law's starting line," Liberto says, "Immediately, regulators will get new powers to take down failing giant financial firms -- powers they didn't have in 2008 when the investment firm Lehman Brothers collapsed and threatened the entire financial system."

Also starting now, the FDIC insurance limit will remain $250,000. Kind of an easy one as the limit was temporarily increased last October in between numerous bank failures.

The bulk of the legislation requires regulatory agencies to study the issues and figure out how to enact the law.

The law firm of Davis Polk & Wardell put together a summary of the bill. By their reading of the legislation, over the next six to 18 months, U.S. regulators will embark on the 243 rulemakings and 67 studies dictated by the law.

Among the studies to be done by the SEC are those involving fiduciary duty and proxy access, issues that were covered in this Bankrate story, "Do investors win with the Frank-Dodd Act?"

Bankrate has also covered other aspects of the bill. Holden Lewis brings you an "Introduction to the mortgage section of Dodd-Frank Act" which examines the minimum standards borrowers should meet and lenders must verify amongst other points in the legislation.

Claes Bell investigates what "Consumers gain from financial reform" as well as the "Financial reform: winners and losers." Consumers get a Consumer Financial Protection Bureau and a promise of an end to bailouts.

Last but not least, Leslie McFadden wrote a piece about the impact of financial reform on borrowing, "FinReg includes free credit scores."

I'm cautiously optimistic about the reform. It could be great or could dissolve into murkiness with all the vagaries included in the legislation. What do you think of the new law?

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