Treasury Secretary Henry Paulson spoke at the Ronald Reagan Presidential Library Thursday afternoon, giving some insights into where he thinks regulatory reform of Wall Street should be headed. Although Paulson did warn against rushing to rewrite regulatory laws,
Paulson did call for a "market stability regulator" with broad
oversight authority for all types of financial institutions, as well as
any financial product whose market size presents a systemic issue.
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This regulator would have "authority to review any systemically
important financial company, and to look for problems anywhere in the
financial system in order to protect against systemic risk."
Paulson advocated giving this regulator power over nondepository
institutions that are too big or too interconnected to fail. This would
likely include hedge funds (and possibly private equity), which he said "should be required to have
a charter that would permit some type of oversight."
"Similarly," Paulson continued, "any financial product whose market size
presents a systemic issue should be subject to regulatory oversight." -
George White
See full transcript of Paulson comments
