US President unveils new financial plan

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US President Barack Obama proposed a major overhaul of the US financial system on Wednesday, unveiling measures he hopes will restore confidence and prevent a repeat of the worst crisis to hit Wall Street in seven decades.

The Obama plan would give new powers to the Federal Reserve to oversee the entire financial system.

The US administration also decided to create a new consumer protection agency, to guard against the types of abuses that played a big role in the current crisis.

Barack Obama, US President, said, "I am proposing that the Federal Reserve be granted new authority and accountability for regulating bank holding companies and other large firms that pose a risk to the entire economy in the event of failure. "

The changes will spark intense debate in Congress, with opponents charging that too many restrictions may harm the ability of US companies to compete in the global economy.

U.S. President Barack Obama waves goodbye after making remarks on financial regulations in the East Room of the White House in Washington June 17, 2009.  REUTERS/Larry Downing