The passage of the sweeping bill ends more than a year of wrangling over the shape of the new rules. It creates an independent consumer bureau within the Federal Reserve to protect borrowers from lending abuses, establishes oversight of the vast derivatives market and gives the government power to seize and wind down large, troubled financial firms. The legislation places much faith and authority in regulators to spot brewing problems in the financial system and prevent another crisis.

 The New York Times reported the following summary today:

"To reduce the odds of a future crisis, the Democratic plans would take three basic steps. First, regulators would receive more authority to monitor everything from mortgages to complex securities. This is meant to keep future financial time bombs, like the no-documentation loans and collateralized debt obligations of the past decade, from becoming rife. Second, financial firms would be forced to reduce the debt they take on and to hold more capital in reserve. This is the equivalent of requiring home buyers to make larger down payments: more capital will give firms a bigger cushion when investments start to go bad. Finally, if that cushion proves insufficient, the government would be allowed to seize a collapsing financial firm, much as it can already do with a traditional bank. Regulators would then keep the firm operating long enough to prevent a panic and slowly sell off its pieces."

But there's more . . . lots more.  The new legislations established a new regulatory agency - the Consumer Financial Protection Bureau (CFPB).  The sole mission of the CFPB is to protect consumers from Bankers.  The CFPB will serve as a "cop" according to the Consumer Federation of America.  You read that right.  In the past, consumer regulations were meant to inform intelligent consumers about a transaction or account.  The times have changed.  Now the government assumes consumers are ignorant and they need protection - not just information.

Bankers may be facing as many as 30 new regulations.  Stay tuned.