How Will the Financial Reform Act Affect Bank Customers?

An analysis of the Financial Reform Act by AccountingWeb shows a variety of impacts on financial activity--some clearcut, such as the elimination of SOX for certain small public companies and a significant tightening of interest-only loans and prepayment penalties on mortgages while others are more subtle--some unclear degree of limits on hedge fund and derivative trading by banks. The Consumer Financial Protection Agency has been given a sizable amount of power and banks are likely to need to have additional legal compliance officers.

As indicated in previous posts, any increase in government regulations given the present weak economy makes me somewhat nervous; having said that, I also recognize that only BP stands in lower public regard than the large banks today within the business community. Hopefully, the tighter regulations will not dry up the willingness of banks to lend to individual consumers of middle-quality credit; however, don't be surprised to see "tight money"; which would further endanger the shaky recovery.