Paulson Calls for Stronger Regulators

nytimes.com — Treasury Secretary Henry M. Paulson Jr. called on Wednesday for a new regulatory system that would prevent future financial turmoil while allowing even large financial institutions to fail without risking a wider market collapse. "Looking beyond the current market challenges of today, we need to create a resolution process that ensures the financial system can withstand the failure of a large, complex financial firm," Mr. Paulson said, during a London stop on his European tour. He said that any new regulation must give the Federal Reserve, the United States" central bank, access to information from all types of financial institutions, including investment banks, and tools that would reduce risk to the financial system without creating the sense that any troubled institution would be bailed out.

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