Come January 20th, Obama will be looking for Congress’ support to pass the largest economic stimulus package in history… another $800 billion. Nevermind that the Treasury hasn’t even requested, much less has a plan for, the remaining $350 billion from the stimulus package passed in September. Oh, and did I mention that he thinks the package could swell to as big as $1.3 trillion? Ah, what’s another $500 billion? We can always just print more money. Besides, we can’t leave out the $5 billion that the adult entertainment industry is requesting.

Something else really caught my attention and snapped me out of the trance caused by Obama’s fluffy rhetoric. He wants to create a Super Regulator for Wall Street by combing the SEC and the Commodities Future Trading Commission.

Obama had this to say about Wall Street and his proposed Super Regulator:

Wall Street has not worked, our regulatory system has not worked the way it’s supposed to. We’re going to have to look at this alphabet soup of agencies and figure out how do we get them to work together more effectively. We’ve got to stop splintering functions in such a way that capital in one form is treated one way and capital in another form is treated another way, because these days in global financial markets, they’re all fungible.

Of course they’re fungible, that’s why it’s called trading and we have different regulations for different types of securities because they’re not structured the same.

I am very leery about a significant overhaul in our financial markets. Now don’t get me wrong, the SEC really dropped the ball with Madoff and the Ponzi Scheme and there need to be some changes in regulation. For example, mark-to-market accounting should be suspended and the Sarbanes-Oxley Act should be repealed. However, significant changes (i.e. significant regulation) in regulation could stifle growth and opportunities, not to mention it’s very expensive.

Obama doesn’t exactly have a plan, but it’s one of the first things he’s say he’ll work on once he takes office. I just hope he can remember the lessons he learned in Economics 101 on the Principles of Capitalism. If not, I’d be more than happy to send my old Econ book to him. I’m pretty sure I have it around here somewhere.