Money Senior Editor Roger Regnier writes approvingly of Elizabeth Warren’s proposal for a Financial Product Safety Commission in the Summer 2007 issue of Democracy. Regnier writes:

In just the past couple of decades, financial technology has grown enormously sophisticated. The economy has been strong and interest rates have been low, so even people with poor credit have been relatively good at paying back loans. And, as Warren has often written, regulation of consumer credit has become more and more, shall we say, relaxed. What we have today is totally new world, credit-wise. Our grandparents never could have gotten a loan for 18 percentage points above the prevailing rate, unless they went to a guy named Lenny Knuckles. Today credit cards charging more than 20% are an ordinary feature of middle class life. Adjustable rate mortgages–to say nothing of option-payment ARMs, no docs, and interest only loans–were considered exotic stuff as recently as five years ago. Your mom and dad may have passed on basic habits of financial prudence, but they probably didn’t teach you how to read the loan agreement on an ARM. We’re climbing a steep learning curve here. It hardly seems crazy to suggest that we could use a little help on the way.

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