Wow.

That about sums up initial reactions to the Treasury Department’s proposed overhaul of the U.S. financial services industry. CNNMoney’s David Ellis says the plan could be “the biggest regulatory overhaul of Wall Street since the Great Depression” and “would be largely invisible to consumers but would drastically alter how the industry is regulated.” According to Ellis’s analysis, the proposal calls for the following:

• Turning the Federal Reserve into a regulator of sorts that would “essentially serve as a financial markets moderator, stepping in if the nation’s markets were again threatened by an episode like the near collapse of Bear Stearns. “
• Combining the Securities and Exchange Commission with the Commodity Futures Trading Commission.
• Creating the “Mortgage Origination Commission,” which would serve as a federal regulator for the mortgage industry.
• Give insurance companies the option of being regulated “at the federal level, instead of the current state-run model.”

Not surprisingly, analysts are chiming in from all corners of the financial world.

• The Wall Street Journal offers its list of winners and losers under the proposal.
• BusinessWeek Chief Economist Mike Mandel says the proposal won’t go anywhere, “both for political and practical reasons.”
• According to Fortune, some experts are wondering whether the Federal Reserve is up to the challenge put forth in the proposal.
• CFO.com examines the call for a “Corporate Finance Regulator” that would assume “the SEC’s current responsibilities over corporate disclosures, corporate governance, accounting and auditing oversight, and other similar issues.”
• Forbes says Treasury Secretary Henry Paulson threw Congress a curveball by shifting regulatory focus back to Wall Street.

The Mortgage Origination Commission sounds like a great idea, given the current subprime debacle. But to me, the rest of the plan sounds like they’re just rearranging the regulatory furniture a bit.

Am I wrong? What do you think about the proposal? Will this improve the financial regulatory process?