# Financial Regulation **Financial regulation** is the body of law and supervision governing banks, markets, and financial firms — capital requirements, disclosure rules, consumer protections, deposit insurance, and the agencies that enforce them. The United States runs a famously **fragmented** regulatory architecture: no single super-regulator, but a patchwork of overlapping authorities — the [[Federal Reserve]] (bank holding companies and systemic risk), the [[OCC]] (national banks), the [[FDIC]] (deposit insurance and state banks), the [[SEC]] (securities markets), the [[CFTC]] (derivatives), the [[CFPB]] (consumer finance), and [[FinCEN]] (anti-money-laundering) — plus state regulators. This fragmentation creates gaps, jurisdictional fights, and "charter shopping" toward the most lenient supervisor, and it is the structural reason crises so often emerge from whatever corner of finance is least regulated. The history of U.S. financial regulation is the KB's cleanest **regulate–deregulate–crisis–reregulate cycle**. The [[Federal Reserve Act]] (1913) and the New Deal framework — the [[Glass-Steagall Act]] (1933, separating commercial and investment banking) plus deposit insurance and the SEC — built the post-Depression order. Decades of deregulation followed: the savings-and-loan liberalization of the 1980s, and the [[Glass-Steagall Repeal]] (1999, Gramm-Leach-Bliley) plus the Commodity Futures Modernization Act (2000) that left swaps unregulated. The [[2008 Financial Crisis]] then triggered the [[Dodd-Frank Act]] (2010), which created the CFPB, expanded CFTC swaps oversight, and imposed stress tests and resolution authority on the largest banks. For the KB, financial regulation is fundamentally a **deregulation story**. The conservative-libertarian project — rooted in [[Free Market Fundamentalism]] and the [[Chicago School]] — treats most financial rules as drags on growth to be rolled back, a view continuously reinforced by industry lobbying and [[Regulatory Capture]]. The second Trump administration has pursued this aggressively: gutting the [[CFPB]], installing industry-friendly chairs across the [[SEC]], [[OCC]], and [[CFTC]], and replacing enforcement with crypto-accommodating "frameworks." The deep tension the cycle exposes is [[Moral Hazard (Term)]]: deregulation privatizes the upside while [[Too Big to Fail]] socializes the downside, so the public underwrites risks it no longer supervises. ## See Also - [[The Banking System]] - [[Capital Markets]] - [[Shadow Banking]] - [[Regulatory Capture]] - [[Dodd-Frank Act]] - [[Glass-Steagall Act]] - [[Financial System Hub]]