WASHINGTON (7/27/11)--The present state of the U.S. financial system and some of the issues that could shape the system going forward are addressed in the Financial Stability Oversight Council’s (FSOC) first ever annual report. The FSOC was created when the Dodd-Frank Act was signed into law just over one year ago. The report identifies declining real estate prices, a sudden increase in term premiums on U.S. government debt, and an escalation of the European sovereign debt crisis as issues that could trouble the economy going forward. The council, which provides a forum for discussion between various regulatory agencies, is comprised of National Credit Union Administration Chairman Debbie Matz, Treasury Secretary and FSOC Chairman Tim Geithner, Federal Reserve Chairman Ben Bernanke, Acting Comptroller of the Currency John Walsh, Securities and Exchange Commission Chairman Mary Schapiro, and Federal Deposit Insurance Corp. Chairman Sheila Bair, and representatives from the Commodity Futures Trading Commission and the Federal Housing Finance Agency. The council will also oversee the resolution of troubled financial institutions. Matz was one of the 10 FSOC members that attested to the report, and added that the release of the FSOC report “marks an important milestone. “The FSOC is a critical institution that will have an important role in financial stability for many years to come,” she added. For the full FSOC report, use the resource link.