June 16th, 2009
11:20 AM ET
14 years ago

Obama wants shield for consumers

[cnn-photo-caption image= http://i2.cdn.turner.com/cnn/2009/images/06/16/art.obama061609.gi.jpg caption="President Obama on Wednesday will call for the creation of a new financial watchdog agency."]WASHINGTON (CNNMoney.com) - When President Obama takes the podium on Wednesday to talk about his proposals for avoiding the next financial crisis, he is expected to unveil one idea that speaks directly to consumers and their pocketbooks.

Obama will call for the creation of a new financial watchdog agency. Its mission will be to protect consumers from deceptive or dangerous mortgages, credit cards and other financial products.

Proponents have dubbed it a "financial products safety commission" akin to the federal agency that oversees safety of toys and other products. Obama himself broached the subject on Jay Leno's "The Tonight Show" in March.

"When you buy a toaster, if it explodes in your face, there's a law that says, 'Your toasters need to be safe,'" Obama said. "When you get a credit card or you get a mortgage, there's no law on the books that says, 'If that explodes in your face, financially, somehow you're going to be protected.'"

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Filed under: President Obama
soundoff (67 Responses)
  1. Fair is Fair

    So the government wants to protect the borrower from the lenders. Why don't they take their own advice and stop borrowing so much?

    Yes... that goes for BOTH sides of the aisle.

    What do you think is going to happen to Social Insecurity when they stop taking in more than they pay out in 2016? You know... when all those IOU's in the "trust fund" come due?

    June 16, 2009 12:32 pm at 12:32 pm |
  2. Independent in Virginia

    Dutch/Bad Newz, VA June 16th, 2009 12:15 pm ET said:
    "If governmnet were involved, we may have been able to prevent the sub-prime mortgage meltdown, which is the main catalyst of our crumbling economy."

    You do know that government creating policy and requirements for mortgage companies to lend to consumers who would not normally qualify is the reason for the housing crisis, right? It was government regulation creating the "lend to poor/minorities who cannot afford a house because having a house is the American dream" is why borrowers foreclosed/defaulted on their houses/mortgages.

    What did these borrowers thing "adjustable-rate" meant in their mortgage...did they think the "adjustable-rate" was a lie? The darn name of the mortgage essentially said "be prepared for your interest rate to go up."

    June 16, 2009 12:35 pm at 12:35 pm |
  3. Glennis

    NO! No more new agencies! Our government is so bloated and unwieldy now that its left hand doesn't know what the right is doing. Stop already. There are already agencies and departments in place to handle this issue. What is Obama's problem anyway? Is his idea of creating jobs having everyone work for the federal government??? Certainly seems so.

    June 16, 2009 12:38 pm at 12:38 pm |
  4. Bill Clinton

    Liberals, Conservatives, Christians, Muslims....Labels.
    If we have a chance, it has to begin by people accepting that they can be proud of who they are without despising who someone else is.

    June 16, 2009 12:38 pm at 12:38 pm |
  5. donttreadonme

    The black spider June 16th, 2009 12:28 pm ET
    WHAT DO YOU REALLY WANT. Refuse to spend the money and stay in the statut quo or spend the money and have a result.
    I am sick and tired fr tis whinners and nothing get done.
    Great point everyone talks about education but every local referendum is voted down or is a major battle.
    The majority of the people who are supporting these changes do so knowing it will cost them nothing. As long as someone else pays we are on board.

    What I want is simple. I want the Government to cut back spending and stop over reaching their power into the markets. I want consumers to buy and demand more American made products made by Americans. We are the greatest consumers in the world and we have the power.

    June 16, 2009 12:39 pm at 12:39 pm |
  6. confused

    It is so utterly stupid these republican complaints. Do you know the largest government was under who? I'm sure you didn't guess this but your dumb president ronald reagan.

    The only person that truly ruined this country. What did he do during his presidency? Nothing. We didn't prosper cause he ended his terms in debt, so do we really have fiscal responsibility when we spend more than we have. Look at Bush 1 – same thing, he ended in debt. Clinton – surplus. Bush 2 no need to answer. Bush didn't even put the cost of billions of dollars into his budgets. His final numbers are outrageous. Who borrowed from China? Bush 2 is that correct republicans. Who did he borrow from first? You guessed it Saudia Arabia. The same people who lent money to the terrorist that bombed us, but he blacklined that from the 911 commission report. The 911 families are trying to sue them and who blocked them. You guessed it, George Bush and now Obama. Who did we sell over 80 billion dollars worth of weapons to? The same people who funded the terrorist that attacked us on 911.

    June 16, 2009 12:40 pm at 12:40 pm |
  7. Jill-IN

    The SEC staff was cut severely about 8 years ago and it needs to be beefed up again with enough accountants and lawyers who can have the time and resources to examine carefully proposed prospectuses for product offerings and unhinge things that are not in the individual investor best interest. You as an individual investor are NOT on equal footing with a bank, insurance company or mutual fund that offers you an investment product for your IRA CD or 401K investment selections. Regulations need to be put back in place and enforced to make sure that your interests are protected. When large institutional investors make investment decisions with banks, insurance companies and mutual funds, SEC regulations understand they are on equal footing and both well heeled. You as an individual are not and if you think all you have to do is sit there and "trust" them, without proper regulations and enforcement to protect you, then you will be fleeced again. We also use to enforce antitrust and anticompetitive activity of companies so that no company could get so large that it could not fail, could control the economy, and could ruin competition. We need to get back to basics and stop letting Wall Street and large corporations run this country into the ground.

    June 16, 2009 12:40 pm at 12:40 pm |
  8. Typical Republican

    Oh, you need another mommy and daddy. This is bull. I think this should be struck, and so should Police departments. If you are too stupid to defend yourself, then you are just stupid.

    While we are at it, no more military! Why should the government protect your stupid self? They shouldn't YOU should. And no more fire departments, put your own fires out, or don't be so stupid as to start one!

    Yea, this government stuff is bull. No more government keeping people safe from criminals and terrorists. Do it yourself and stop wanting the government to do it for you! You babies!

    June 16, 2009 12:40 pm at 12:40 pm |
  9. Neutralizer

    Hussein Obama porkulus bill put this country deeper in DEBT and USA is now about to lose its AAA credit rating.

    This man is a snake oll salesman. He's full of it and some. The ONLY people Obama can convince are the thinking impaired of this country.

    June 16, 2009 12:42 pm at 12:42 pm |
  10. Joanna

    Yes, someone needs to control big business and look out for us for a change! I am so sick of having No power with these people. They abuse us.

    June 16, 2009 12:43 pm at 12:43 pm |
  11. Fed Up

    Geez, can't any of you accept responsibility for your own actions? Do you really need the government to take care of your every need? Are you afraid to grow up and take care of yourself? This is incredible that so many need this much assistance in their lives. It's a big bad scary world out there.

    June 16, 2009 12:45 pm at 12:45 pm |
  12. renea

    This president is for the american people he cares about what we thinks and are going thru if not why would he come on tv to explain what he is going to do so much before hand. take GW when did he let us know anything before he did it no, he just did it no matter what the wars,or anything else when he spent money he just did it no matter what you thought or anyone for that matter.

    June 16, 2009 12:47 pm at 12:47 pm |
  13. TCM

    what a boob we have for a president....Hey OBama....I've made my own way all my life...responsible for my own credit cards, health care, automobile....just like all of my RESPONSIBLE friends....what makes you think we need you to "fix," anything? You've already proven that you're full of bad decisions....and poor judge of character by your cabinet picks...

    Now, with ABC broadcasting from the WH...and claiming they are "solely," picking the audience...to ask the president questions...please..enough of this corruption...go back to Kenya where you belong.

    June 16, 2009 12:48 pm at 12:48 pm |
  14. Grow up

    It's really not that complicated folks. You make purchases with your credit card, the bill comes in the mail, you pay it and go on with your life. If you can't afford to pay for it when the bill comes in, don't buy it, you don't need it. What don't you understand about that? You need the government to do what for you??

    June 16, 2009 12:49 pm at 12:49 pm |
  15. Christopher in Wisconsin

    Here's a novel idea: require every investment advisor to put in writing the actual returns for the clients they recommend investments to. So often investment advisors blow up their clients' portfolios and there's no accountability. If consumers were required to be given an audited report that showed ow the advisor's clients actually did, they could make better choices when it comes to securing teir financial future.

    Also, require every commissioned broker to put in writing what their actual compensation is going to be for every investment product they sell before the transaction is completed. No more hidden compensation – everything out in the open. That would help consumers immensely.

    June 16, 2009 12:49 pm at 12:49 pm |
  16. TCM

    @ Joanna –


    June 16, 2009 12:49 pm at 12:49 pm |
  17. Neutralizer

    Fair is Fair June 16th, 2009 11:44 am ET

    Oh, I don't know, Mr. Obama… how about something called "personal responsibility"? Something like "gee… maybe I have to live within my means"? Something that is becoming extremely rare lately?

    Sorry… you can't compare the toaster to the mortgage. The blame for bad financial decisions lies with those who make them.


    The crash of our financial system started with FANNIE MAE AND FREDDIE MAC . This two INSTITUTIONS was CREATED by the DEMOCRAPS. Go back to the time of Carter and you'll see how the WHOLE SHEEBANG started. Community Reinvestment Act of JIMMY CARTER is the ROOT CAUSE of this ALL.

    Democraps CANNOT be trusted when it comes to the economy or national security – in fact you CANNOT trust DEMOCRAPS for ANYTHING.

    DEMOCRAPS is like a JUVENILE who go on shopping spree with their parent's credit card AND expect their parents to pay the bill without any complaint. That's what the democraps are IMPOSING right NOW to the American people.

    Of course the ONLY people who doesn't complain and say to Obama YES! YES! are those living in GOVERNMENT CHEESE. They have nothing to lose, they don't pay taxes, but they sure as hell suck up the system worse than your vaccuum cleaner.

    June 16, 2009 12:49 pm at 12:49 pm |
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