Mr. Kashkari , '' Congressman , there is no question that clarity and certainty are very important for developing market confidence .
This is consistent with Treasury 's mission to promote the market stability , orderliness , and liquidity necessary to support our economy .
This role for the Federal Reserve with respect to the GSEs is consistent with the recommendation made in Treasury 's Blueprint for a Modernized Financial Regulatory Structure .
Therefore , after consultations with the Federal Reserve , OFHEO , the SEC , and congressional leaders , we are asking Congress , as it completes its work on a stronger GSE regulatory structure , to also enact a three-part plan to address the current situation .
Certainly in recent months , no one can accuse Chairman Bernanke , Secretary Paulson , Chairman Bair , and others of timidity in the face of this crisis .
Despite efforts over the past year by the Federal Reserve , the Treasury , and Congress to stem the crisis , global financial markets remain under extreme stress .
At the Federal Reserve , we have sought to address financial market stresses with as minimal exposure for the U.S. taxpayer as possible .
I also appreciate that the Congress and the Administration are working closely together and we have been for a number of days now so that we can help the American people by quickly enacting a program to stabilize our financial system .
The events leading us here began many years ago , starting with bad lending practices by banks and financial institutions and by borrowers taking out mortgages they could n't afford .
I propose today , Mr. Chairman , I would share with you five near-term regulations the Financial Services Roundtable have .
So if mortgage rates do not fall , then we urge Congress , the Treasury , and the Federal regulatory agencies to consider additional appropriate actions .
Mr. Kashkari , '' Good morning , Mr. Chairman , Ranking Member Bachus , and members of the committee .
Mr. Ludwig , '' This mortgage broker situation is really pernicious , Mr. Chairman , and what the Congress has done under your leadership is very important .
First , Americans have come to expect the Federal Reserve to step in to avert events that pose unacceptable systemic risk .
Any plan that is considered by this Congress must include at least four points : Number one , independent oversight about how this money is being spent so we can avoid a future financial crisis .
Mr. Kashkari , '' Congressman , I feel confident that the financial system is stronger than it was when the Congress acted so quickly .
Mr. Seligman , '' Mr. Chairman , we have reached a moment of discontinuity in our Federal and State systems of financial regulation that will require a comprehensive reorganization .
But to create a single clear crisis manager only begins analysis of what appropriate structure for Federal regulation should be .
Mr. Cox , '' Thank you very much , Mr. Chairman , Senator Shelby , and Members of the Committee , for this opportunity to describe the SEC 's actions to deal with the recent developments in our financial markets .
That oversight board includes the Secretary of the Treasury , the Secretary of Housing and Urban Development , the Chairman of the Securities and Exchange Commission , the Director of the Federal Housing Finance Agency , and the Chairman of the Federal Reserve Board .
Fourth , we must maintain present firewalls , eliminate current loopholes , and prevent regulatory arbitrage in the new regulatory system .
Despite the efforts of the Federal Reserve , the Treasury , and other agencies , global financial markets remain under extraordinary stress .
In the case of Lehman Brothers , a major investment bank , the Federal Reserve and the Treasury declined to commit public funds to support the institution .
In this regard , the Federal Reserve supports the Treasury 's proposal to buy illiquid assets from financial institutions .
Working with the Treasury , the FDIC , and other agencies , the Federal Reserve believes that we must take all steps necessary to minimize systemic risk .
An example is the Term Asset-Backed Securities Loan Facility , which calls for an equity investment by the Treasury Department and credit provided by the Federal Reserve .
In many cases such consultations have been organized by Treasury Department and have included a wide range of government agencies .
Indeed , consistent with that intent , the Federal Reserve has , since 2006 , published a separate rate series for asset-backed commercial paper .
But the Comptroller of the Currency , FDIC , the Federal Reserve -- we have Governor Duke here -- these are all regulators of the banking system .
As provided in the Act , the Federal Reserve Board and its staff are consulting with Treasury regarding the TARP and Chairman Bernanke serves as Chairman of the Oversight Board for TARP .
Our financial institutions are repricing risk , de-leveraging , recognizing losses , raising capital , and improving their financial position .
All significant U.S. financial institutions that provide credit have some form of access to Federal Reserve liquidity facilities at this time .
One of the major reasons why excesses developed in housing finance was a failure of Federal regulators to adequately supervise the behavior of bank holding companies .
On July 15th , the SEC also noted that it will undertake a rulemaking to address these issues across the entire market .
In closing , both the Commission and the New York Federal Reserve have played crucial roles throughout the current financial crisis .
Mr. Chairman , I hope that these observations from the SEC will be of assistance to you and to the committee as you consider the broad questions of whether and , if so , how to reform the existing Federal regulatory system for financial services .