" Federal Reserve Chairman Ben S. Bernanke is mobilizing to placate Democrats in Congress who claim he isn't doing enough to crack down on predatory lending.
Bernanke begins two days of testimony to Congress tomorrow, and he is already anticipating the questions. The Fed and state regulators today announced a pilot program to collaborate on supervision and enforcement of non-bank supbrime lenders. The central bank, which House Financial Services Committee Chairman Barney Frank has threatened to strip of some regulatory powers, also plans an overhaul of lenders' disclosure standards.
The steps that Bernanke, 53, is being pushed into amount to rolling back at least part of the free-market legacy bequeathed to him by predecessor Alan Greenspan. During Greenspan's 18-year reign, the central bank was loath to meddle with banks' business practices, relying on guidelines instead of enforceable public rules. "
A Fed that meddles...
That can only speed up the withdrawal of liquidity and accelerate the process of deleveraging...
Source: Bernanke Chips Away at Greenspan's Free-Market Legacy (Update1) (http://www.bloomberg.com/apps/news?pid=20601109&sid=a4Tt6nUF2gKg&refer=home)
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