Senator Chris Dodd's latest bash at reforming financial regulation hands wide prudential authority to the Federal Reserve, with input from a council of regulators. With appropriate teeth, such a mix stands a decent chance of improving systemic oversight.

It is broadly logical to expand the central bank's role to include bubble-prevention. It is already a hands-on bank regulator and the lender of last resort should have something to say about systemic risk.

Subscribe Now

Access to authoritative analysis and perspective and our data-driven report series.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.