The most effective time to reform dangerous habits is after a nasty shock. The object lesson of a burned-down house or wrecked car is a powerful motivator to purchase insurance and the near destruction of the banking industry in the financial crisis of 2007 was just such a shock to the industry. In its wake, the need for regulatory reform was both obvious and practicable, leading the Basel Committee on Banking Supervision to propose comprehensive reforms in the banking sector. After tough talk in December, 2009, industry commentators were surprised when the committee released changes to the plan on July 26, 2010. The alterations to the proposal uniformly watered down the proposed measures that had been published seven months prior. After deliberation, the apparent stepdown may not be an entirely negative development.