Wall Street Journal: Paulson to Recommend Revamping Mortgage Rules
The Wall Street Journal reported yesterday that U.S. policy makers, led by Treasury Secretary Henry Paulson, are due to recommend a revamp of rules related to credit markets and mortgage brokers.
Paulson said in an interview that the President's Working Group of Financial Markets would recommend strengthening state and federal oversight of mortgage lenders and brokers. The plan comes as the government and the Federal Reserve seek to fix a debilitated U.S. mortgage bond and housing markets.
Their recommendations extend to nearly every niche in the credit markets -- from mortgage brokers to the Wall Street firms that package home loans into securities, to the credit-rating firms that assess the risk of those securities, to the regulators who police the system.
"We aren't singling out any group of market participants, because...there were mistakes made by all," including regulators, Treasury Secretary Henry Paulson said in an interview yesterday, a day in which the stock market's euphoria over the Federal Reserve's latest initiative to free up the flow of credit gave way to some caution.
"Regulation needs to catch up with innovation and help restore investor confidence, but not go so far as to create new problems, make our markets less efficient or cut off credit to those who need it," said Paulson.
Paulson is due to deliver a speech on financial markets today at the National Press Club at 10 am New York time.
Published on March 13, 2008
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