will get through this. i think doing something that you love is a wise goal. >> let me just add that public service is a wonderful opportunity, enriching and rewarding. >> do you consider yourself a government bureaucrat? >> no. [laughter] . .

has the role of women changed? >> there are more opportunities. there is more work to be done. we're taking more seriously and given more opportunities for advancement. we do have a seat at the table in key meetings. we still have to fight to get into the key decision-making. but there are a lot more opportunities. it has changed. it has been a continuum. >> what are some positive things that women bring to the financial sector? do you still find that you are one of the few in a sea of suits? >> it is changing.

on one of the nice things about the white house is that i have more women around me and i had in my academic life. at some level, it is natural interaction. there is a special bond. i definitely have the sense of each of us looking out for the other. i think that is really fantastic. >> is that by design? did you set up women around you? >> when i hired, i was trying to look for the best people. in many cases, the best people were women. i think the president and the people organizing the white house get a lot of credit. they were looking broadly for talent. they founded in some unusual places. it is a fabulous environment. >> the next question is more about the state of states and also brings up went into it.

what are some specific ways that you believe pending changes to financial and banking regulation will help the american people and the financial system get on sound footing? what is most important in terms of financial corporation reform? >> it is an opportunity for us to do a lot going forward. the focus on consumer banking is something that elizabeth can speak to with tremendous knowledge. it will be very important for women, housewives, and americans going forward. i think getting the largely unregulated derivatives under the regulatory umbrella it is a critical step for us to take. the focus on systemic risks regulation is very important. closing the gaps created over the years that have allowed our economy to be in the dire circumstances we found ourselves

in the last couple of years. >> how will derivative transparency affect the average person? >> if we look only at the carnage on the street, it is largely because of derivatives. the relationships a big financial institutions with the derivatives brought a lot of institutions to the brink. the availability of credit, the soundness and trustworthiness of financial institutions were affected broadly. >> this crisis started one lousy mortgage at a time. the raw materials that into the system where these terrible 1 inches mortgages -- terrible mortgages. the system permitted that.

there were people who walk into these things without a clue of what was happening to them. it is important to remember that the first wave of selling subprime mortgages was two people that already owned their own home. they managed to get themselves refinanced right out of them. the consequences of the kind of consumer credit markets that has evolved over the last 30 years, the notion of making profits of tricking people has led not only to the destabilization of american families but also of the economy. we dial that back with the consumer protection agency and mortgages that people can understand. we make a huge difference at the family level and at the economy level. >> the consumer protection agency will be able to oversee and insure that the bad

mortgages, mortgages on properties that are not worth what they said they were, that will ensure it does not happen again? >> it actually repairs broken market. the design is to say that both parties in a transaction ought to be able to understand the terms. a borrower should be able to tell the costs and risks up front and be able to compare agreements to find out which one is cheaper and which one carries more risk. if we can get that basic part of the transaction back in place, we can count on american families to make smart decisions in general. we do not need a heavy hand of regulation. we just need enough help to the market working in the right direction. >> i want to follow-up on something that mary said. we cannot see how important the consumer protection agency is.

it sounds like a big authority in making sure that someone is regulating the big, systemic institutions -- those are basically tfamily and job issues. we are living through the carnage of the system breaking down. the reason we are also committed to moving financial reform forward is to make sure we are never in this position again. our grandparents in the great depression gave us 80 years of a system that was stable. we need to put in place a regulatory structure that will give us another 80 years. >> we will see more bubbles. we will fall in love with something again. it will create euphoria and be over down again. >> there are always cycles. this bill will give us better tools to clamp down on those

before they occur. when there are failures, there will be better tools to deal with them and avoid the terrible bailouts that undermined public confidence in the institutions and the government. it is common sense. it is having transparency in the derivatives markets. i hope we have also had a paradigm shift in terms of how the country views regulation. we went through years where regulation was viewed negatively. it is good to pass new laws and come up with better structures and regulatory tools. unless there is political support, it will not work. the reality is that there were regulators trying to curb this back. they did not give political

support. there was a lot of political opposition. even now coming out of the crisis, there is pressure not to regulate. i believe in free markets. the difference between three markets and free for all markets is that you need common sense and basic rules. it is important for the public to understand that and provide support for the basic function. >> 30 years ago, you went up some money and they paid it back with interest. that was it. now, it's kind of spreads the risk. >> everyone thought we were at spreading the risk to the mortgages and other receivables. we thought we no longer needed to worry about risk. investors were going to buy these asset-backed securities and share the risk. that is not really how it turned

out. we were not really dispersing risk through the system. in some ways, we were concentrating it. >> how do you think things have changed already? you said that we are going to see more changes. we've already seen a different perception as it relates to the industry. there is a different perception on the part of regulators. we have already seen a change in terms of the perception of wall street. up until now, before we got to reform, what would you say it has already changed on wall street? >> we certainly see a change in health families are behaving. we see savings rates are higher than they had been. in the mid to thousand's, the redound very low. we do see caution on the part of

households wanting to get their financial lives in order. i think that is a positive development. it is something we will have to be navigating. we cannot count on consumers to be the engine pulling us forward in terms of a recovery and fast growth. we will have to be thinking about whether other things are taking the place like business investment or net exports. but there is the change in behavior. >> i believe we are beginning to see a change in how corporations and their boards government their activities. they are more focused on risk management. they're more focused on issues like excessive executive compensation. we are seeing more activism by institutional shareholders to push forward in that direction. i think that will be a very good development for our economy. i hope it is not just wishful thinking. i hope we are seeing motion in that direction. >> that would be a critical cog

in the wheel. >> i was trying to decide if i should be honest or not. [laughter] i will be honest. i have not seen anything change. i know that is a provocative statement. i have not seen anything meaningfully changes. the culture that led this crisis is still there. the divorcement of views in terms of what you are paid and the value you produce is still there. i do think further engagement is required. you cannot categorize all institutions in the same bucket. there are differences in the efforts they're making to support the economy. i do not think i have seen a culture shift. i regret that.

if it has to be done with more prescriptive regulation, and do not think that is helpful. there are more active shareholders. i think that is helpful. even with some shareholders, you have to determine between the short-term and long-term shareholders and their incentives. i hope there is improvement, but i am not sure i see evidence of that yet. >> should higher education professors be involved in this? the success in school is getting a recruiter to come to college or business school and say we will offer you a lot of money to come. diller is still compensation. -- the allure is still compensation. maybe instead of pursuing money, they should pursue their dream. you said you really have to love what you do. it should colleges and higher education leaders be involved in

this? over the years, financial services have become so big. all of or a lot of the talented people coming out of schools were going there for the compensation as opposed to doing some of the underpinnings that the economy needed in manufacturing or whatever. >> thinks financial-services got too big. -- i think financial services got too big. it consumes a disproportionately unfair portion of our resources. it needs to be downsized. the talent needs to be drawn into efforts that more directly support the real economy. that is a trend we need to see and are starting to see. >> this is a question from yale, a graduate in 2011. in the past, and then completely dominated in positions of leadership.

what do you think are the primary drivers of women rising to the top? what are the obstacles to this positive trend? >> one of the drivers is that it had to happen at some point. [laughter] the numbers are just there. every time you talk about this it underlines the fact that 30 years ago, women were nearly half of my graduating class. we had problems getting hired at the big firms, the time with solve the problems. if we're graduating in big numbers the talent will be there. we're celebrating that we made it to 2% 30 years later in the companies. that is nuts. i am glad that is the case. the time alone will not solve

the problem. we have to be thoughtful about how it is that women and other groups that are under- represented on wall street that those people will be brought in to the entire sector. part of the insert is that sometimes you have to be much more conscious -- part of that answer is that sometimes you have to be much more conscious about what is that breeds success. it is not enough to have a good education. how often do women get a chance to talk? how often do they get invited to speak? how often do you say you will bring three more women in with you? the studies are starting to come out.

they're serious sociological and psychological studies of how we expect to listen to men's voices. they carry more authority than women's voices. if we do not retrained ourselves, both men and women, we will have another one of these events 30 years from now. women leaders and finance will still fit on a very small stage. >> what do you do when you have worked on a project and you know that this is the right way to go? he presented to your boss's -- you present it to your bosses who may be male, how do you push back? can you push back? >> yes, you have to.

the key thing is to do the best work that you can. have a very strong point of view. you make that case. sometimes you make it many times. sometimes you can make yourself kind of annoying. at some point, either everybody agrees or you lose and you go on. the important thing is whether you have tried, and given it the best chance possible, done your homework to see if you can get allies. is not just being the lone voice, is learning to work corporately. >> you do not want to work for someone who does not lead to push back. at the end of the day, what is the value of being surrounded with people that tell you what you already thing? yet not advanced the ball or engaged the discussion. you want to work with someone who will let you say exactly what you think and have the debate and discussion with you. at the end of the day, everybody

needs to march in the same direction. >> you want people who will give you the opposing view or you will not make the decisions. >> that is right. we get to be the boss now. >> someone who will come in and advocate, respond to questions. i really respect that. people will stick up for their position, that is something i want to hear. >> questions from the audience? yes. >> you laid out the three different initiatives you have, commissioner. one of them was investor confidence and bringing them back into the fold. i am one abortive travelers

insurance. we deal with risk-management all the time. -- i am on the board of travelers insurance. we deal with risk-management all the time. i often joke that we need a license to buy car but we do not need a license to buy these innovative products. what can be done to help investors and women understand money and risk? is there something we can do in the private sector to partner with you? >> if you look at the websites of different financial institutions, some do a good job of important basic investor education information. that is critical. we ought to have a minimum requirement for graduation from high school of economic and investor knowledge. when i went to high school, you have to have home economics credit.

you would have been better off getting an investor education credit. i think that is something as a country which should be supporting broadly. -- we should be supported broadly. our offices partnering with the rest of the federal government. we are partnering with advocacy groups to help people understand the basics of investing, working with different foundations. i think it is really important. i also think it is important for us to teach people as young as weekend and all through their lives about investing. we also need to make sure that we have given them the tools to understand the financial products that are being presented to them. rate disclosure of a point of sale of mutual fund expenses and risks, for example. better information about how to vote by proxy when they are an investor. what does it mean to vote by

proxy? we are trying to our rulemaking and educational efforts to give investors the tools that they need to understand the products being presented to them. >> that is a great point. the problem is that nobody ever teaches you this stuff. you become an adult and still do not know. >> you may have learned in school because you joined an investment club. it is not part of the curriculum. that is not the way to get it and educated nation of investors. >> someone suggested having a town hall back in 2002. he now serves on the board of travelers. if there's a structured way we could do a partnership, i would be interested in doing more. >> we want to get as many questions as possible. >> i would like to focus on

retirement. many of our 401k's have been depleted. women in particular are spending an average of less than 12 years less than men in the workforce. they have less money they're working with. they're less likely -- how do we begin to get went into the money it smart about retirement? what can you do to advance this issue of women's security and retirement? women are very much on their own as they approached the much more important issue of security. >> let me take a narrow slice of that. the educational efforts are critically important. we also have to do something to ensure that a lot of products that are now being renovated for the retirement market are products designed to serve the

interests of the retiree and not designed for the purpose of generating new fees and revenues for the institutions that created them. one of the critical things for the sec to do is really understand the products, warned investors of what they should be warned about. bring cases quickly when the conference has been violated. >> how did you learn about money? you are successful. we're trying to figure out how others can become so successful. did you learn it at home when you were young? did you learned in school? -- did you learn in school? >> i was all set to be a lawyer. i was going to major in political science. in political science, then made a stick to your of economics.

it was like a light went off. i loved it. i have ended up learning about money that way. you learn the theory of money and finance. you then bring that into your everyday life. i just took to it. >> on retirement, i support everything that mary is talking about. when we talk about financial education, we are starting one level too high when we talk about things like people should learn about proxy statements and so on. i think it starts with basic budgeting. there is no one on the side of teaching consumers about expenses, flexible spending, and

savings. we are perpetually bombarded to spend. to the extent there's anything on retirement, there is not as much. that is what is going on. the notion of how we think about the education around money is that we have not established core principles. if you are well-off and thinking about how to invest your money, that is good. four other people, it will never get to that point. -- for other people, it will never get to that point. the number one retirement plan and america is not a 401k or savings account. it is to pay off your house and live on social security. the devastation being wrought over the past decade by the

depletion of equity in homes, the entire housing bubble was accompanied by a decrease in the amount of equity and a reduction of number of people who had their homes paid off and could live in those homes for the remainder of their lives and live on social security, that has been wiped out for literally millions of families. we're going to pay the price for that for another generation. we have a lot broader thinking to do. >> it is worth examining how you get smart about money. i learned at home. there were basic things like do not spend what you do not have. that stayed with me forever. you have to start at home and then in school. >> i think most of us have parents who were products of the depression. at home, we did learn those

kinds of lessons. the next generation has grown up under different circumstances. >> some are products of the dotcom boom. >> our homes were not financed on credit. my parents did not have credit cards because they were morally superior or had more money. my parents paid cash. they took on medical debts to keep us healthy, the home mortgage. i do not think our parents would have understood. >> it has been established that women earn less than men on average. we also know that women tend to run the household budget often. as a personal finance journalist, i go around the country. i meet many unsophisticated people who do not have much money. they have no idea how the mortgage works.

they need a lot of sophisticated, smart and -- i also need a lot of sophisticated, smart mba's who also have no idea how mortgages work. how likely will be to achieve the basic goal of understand able language, plain vanilla mortgages, payday loans? what is the obstacle? how can we work to get this in there? >> will be part of the consumer protection agency, this financial literacy? where does this piscece go? >> the agency is build on that principle. it is not built on the principle of you are not allowed to do this. it is built on the