With the Federal Reserve actively lobbying to become the sole protector of consumers in the financial system, it was inevitable that they would have to engage in some consumer protection theater so as to make people forget just how badly they have fumbled this ball over the past 30 years or so:

The Federal Reserve on Thursday proposed sweeping new consumer protections for mortgages and home-equity loans.

The proposals seek to overhaul the timing and content of disclosures to consumers, and to ban controversial side payments to mortgage brokers for steering customers to higher-cost loans.

The cow has left, so now they are closing the barn door, in the hope that they can continue to manage the herd.

The Federal Reserve really does not want a dedicated consumer financial protection agency, because it would engage in real consumer protection, which, based on the record of both the Federal Reserve and its New York bank (*cough* Timothy Geithner *cough*), have not done, choosing instead to pimp for Goldman Sachs and its ilk.