You would think so but the reality is that these factors, when enforced, place certain demographic groups at distinct disadvantages. That disadvantage can be au

You would think so but the reality is that these factors, when enforced, place certain demographic groups at distinct disadvantages. That disadvantage can be augmented when a bank can no longer hide (for all intents and purposes) who they are lending money to. For example, I could analyze a pool of loans by a Michigan based auto lender. Under current guidelines, i basically get id numbers, fico score, stats on seasoning, outstandnig balance, etc. Who knows where these people live. With new data i could start guessing with reasonable accuracy where these people live (never on an individual basis, but you can get an idea of what counties or towns). I could discern that Bank B is lending to a "riskier" demographic than Bank A. While Bank B cant legally discriminate in their lending policies, the capital markets can certainly discriminate on which notes they want to buy. This would raise the cost of capital to banks lending to "disadvantaged" groups in society (minorities, immigrants, etc).Now a quick fix is for people to analyze the data and make sure that there is no humanly way that analysts like myself can figure narrow down where people in a pool live (which allows us to make assumptions on makeup), but from what i've seen that isnt going to be the case. Now you're in a predicament. African Americans are over twice as likely to default on a home loan than their white counterparts. Who stands to lose here? Look its just a thought. Finance is so complex that it's virtually impossible to figure out the second and third layers of unintended "consequences" of monumental legislation like the Dodd bill. Things are still playing out and there are armies of lawyers trying to predict how it will affect capital markets. So much is still uncertain (which explains why the markets are behaving the way they are). One thing isnt, the middle and lower classes are going to get hit hard. Not because the rich arent being taxed enough, but because these regulations are going to make the cost of funding consumption noticeably higher across the board. My group is predicting that within 2 years we will see an end to "free" credit cards that come with rates less than 9%. With risk-based pricing out the window, issuers need to find a way to imbed reserves into their loans or recoup higher potential for loss.