Only a few of the finanial reforms recently passed actually protect the consumer. Many of them actually act as a hinderance to lending.

Requiring banks to increase their capital to abnormally high minimums when they are healthy restricts the amount of money out on the street available to lend. Then, doing away with PMI, as much as of a pain as it is, restricts the amount of money banks can lend consumers on deflated home values, further restricting the amount of money available to lend to individual borrowers.

There are a couple of other cool thinks like disclosure issues where if the amount of fees disclosed in the good faith "estimate" aren't exactly what they will be at closing, you get to delay closing for an additional 2 weeks. So now the estimate has to be exact. Go figure. (Yes, I know there was some abuse, but not by everyone, but .GOV has to manage to the lowest common denominator, and the consumer they are trying to hel;p actually gets hurt.)

Basically, in this case, .GOV is being more of a hinderance to consumers because the politicians don't know what is in the legislation that they are passing.

I'm not getting into econ 101/102 class discussions. I'll let the other guys do that and just stick to the industry stuff.