Congressman Jeb Hansarling (R-TX), Chairman of the House Financial Services Committee recently introduced new legislation called the Choice Act that calls for moving the country away from the Obama Administration’s financial control law (Dodd-Frank) to a new paradigm in banking, capital markets and financial opportunity.
Over the weekend the Wall Street Journal featured a lead editorial about the plan and how it will benefit America. The WSJ says Hensarling’s plan will “promote economic growth and protect taxpayers.”
“The Texas Congressman wants a simpler system in which private investors with money at risk decide which assets are safe. Under the Hensarling plan, banks can opt out of today’s complicated rules if they have capital equal to 10% of their assets. Their tally of assets has to include off-balance-sheet exposures. No more hiding toxic paper in conduits or structured-investment vehicles as Mr. Geithner allowed Citi to do before the financial crisis. And no more pretending that a financial instrument has no risk because a regulator says so.”
“The Hensarling plan would make the financial system more stable by encouraging greater diversity. Freed to make their own decisions on the quality of assets, some banks would run off the rails, but they are less likely to make the same mistake at the same time.”
Click here to read the full editorial
Click here for more information about the Choice Act.
