After the 2008 financial meltdown that brought the US economy to near collapse, Obama and the Democrats set about reforming the financial regulatory system. The legislation that passed, called the Dodd-Frank Wall Street Reform and Consumer Protection Act, was signed into law in July 2010 and touted as the most sweeping reform since the post-Great Depression era.
The law enhanced federal oversight of financial companies and created the Bureau of Consumer Financial Protection, which regulates consumer financial products and services. The act also creates new requirements for derivatives, hedge funds, private equity funds, and credit rating agencies.
Critics argue that the act does not adequately address the “too big to fail” issue around large financial institutions and doesn’t deal with the problems of secondary mortgage giants Fannie Mae and Freddie Mac. But for Obama’s purposes, Dodd-Frank gave him a major legislative achievement that he can take to voters as he seeks to reassure them about Wall Street and their own financial safety.
The same holds true for the Credit Card Accountability, Responsibility and Disclosure Act, signed earlier in 2010, which aims to end abusive practices by credit card companies.
