cross - function process that is devoted to the identification and analysis of these trends to provide early warnings on emerging consumer problems for our examination team, and enhance our messaging to consumers and nonprofit support organizations. additionally, we are leading a robust and informed dialogue among community and financial industry stakeholders on ways to modernize the 1977 community reinvestment act ( cra ) to reflect changes to the financial landscape and new delivery mechanisms for financial products. how we function the board's division of consumer and community affairs ( dcca ) has primary staff responsibility for carrying out our consumer protection program. but the division draws substantially on resources and expertise from other functions of the board and the federal reserve system. the board's experience is that the most effective programs require a multidisciplinary approach that draws on a deep understanding of consumer behaviors and interests, as well as financial markets and industry operations. recognizing that, key elements of the division's program include : • rulemaking as a pillar of our consumer protection program that utilizes a team of attorneys to write regulations that implement legislation, update regulations, respond to a changing marketplace, put useful and effective disclosures in place, and prohibit unfair and deceptive acts and practices ; • consumer testing to develop effective disclosures that are meaningful to consumers ; • supervision and enforcement of state member banks and bank holding companies and their nonbank affiliates to ensure that consumer protection rules are being followed ; • consumer complaint and inquiry processes to assist consumers in resolving grievances with their financial institutions and to answer their questions ; • consumer education to inform consumers about what they need to know when making decisions about their financial services options ; • research to understand the implications of policy on consumer financial markets ; • outreach to national and local government agencies, consumer and community groups, academia, and industry to gain a broad range of perspectives, and to inform policy decisions and effective practices ; • support for national and local agencies and organizations that work to protect and promote community development and economic empowerment to historically underserved communities. interconnections between consumer protection and prudential supervision as early as the 1970s, the board recognized the need for dedicated experts to conduct consumer compliance examinations. since that time, the board has had a separate examination force, specially trained in the intricacies of consumer compliance laws and regulations. at the same time, there is recognition that consumer protection supervision is connected in important ways to prudential supervision. as a result, the board's separate divisions for consumer protection and prude

housing and mortgage markets. the federal reserve supported placing fannie mae and freddie mac into conservatorship to help stabilize an important source of housing finance. more recently, the federal reserve has announced that it will purchase $ 600billion in debt issued by the housing - related government - sponsored enterprises and in mortgage - backed securities backed by fannie mae, freddie mac, and ginnie mae, which could reduce funding costs for mortgages. it also is supporting foreclosure prevention and neighborhood stabilization efforts, which help reduce unnecessary foreclosures and their costs on communities. limiting foreclosures will also help reduce the risk that house prices will sink significantly below the level justified by fundamentals. the events of the past year and a half have highlighted the need for changes in our financial system. presumably, such changes may include a different balance between bank - based and market - based financial intermediation. as regulators of banks and thrifts, our job is not to determine what this balance should be. rather, our job is, and has been, to create an environment in which, in the short run, banks can step up to fill as much of the gap as possible that has been left by still - dysfunctional markets, consistent with a strong, stable banking system. over time, of course, we will need to work with the congress and the new administration to construct a system of oversight over both markets and institutions that better protects the stability of the financial system and the u. s. economy. see board of governors of the federal reserve system, federal deposit insurance corporation, office of the comptroller of the currency, and office of thrift supervision ( 2008 ), " interagency statement on meeting the needs of creditworthy borrowers ", joint press release, november 12.