For the real estate industry the requirement that originators keep 5% of loans that they securitize in RMBS or CMBS is of distinct interest--if it helps jump-start the moribund capital markets as it is hoped it will do. Other changes proposed by the Administration, though, promise to pack an equally potent wallop albeit in the longer term.

For starters, Treasury is proposing to make the Federal Reserve act as an overseer of companies deemed "too big to fail"--a term that has become part of the industry lexicon after nine months of financial crisis, but has yet to be adequately defined. In this plan such companies are termed "large and interconnected" a category that appears to go beyond banks to include other financial institutions.

These new powers would include greater ability to impose capital and liquidity requirements as well as take corrective actions when these levels are not maintained or achieved. The Fed would also have the ability to help unwind these entities when necessary.

The plan also creates a new Consumer Financial Protection Agency that would be able to reform mortgage regulations with an eye towards protecting consumers from deceptive or complex products. Among its proposed powers would be the ability to ban unfair practices or terms and punish companies for violations of its rules.

The plan also establishes a National Bank Supervisor; it would oversee lenders and assume the responsibilities of the Office of the Comptroller of the Currency and Office of Thrift Supervision.

If this sounds like a complete overhaul of the nation's regulatory and financial oversight apparatus that is because it is--a fact that President Barack Obama does not shy away from in his prepared comments.

The events of the last year, "was a failure of the entire system," he said. "An absence of oversight engendered systematic, and systemic, abuse."