Washington ? President Barack Obama is ready to roll out an overhaul of the intricate rules and systems that govern America’s troubled financial institutions, proposing the most ambitious revision since the Great Depression.

Unlike the government’s temporary ownership stake in automakers and major financial companies, the regulatory changes set to be announced Wednesday are designed to be permanent.

They could result in a major realignment of power and authority among government agencies that set the rules for banking, lending and investing and touch American lives through daily transactions, from credit cards to mortgages and mutual funds.

The proposals are the source of debate in Congress over whether Obama’s measures will prove too timid or place too heavy a hand on the levers of capitalism.

At issue is a 21st century system of high-stakes swaps and trades, bets and losses where trillions of dollars worth of investment products have grown too intricate for a 20th century regulatory structure.

Imagine today’s financial transactions as an athletic contest where the referees have lost their vantage point. Plays occur out of their sight and fouls go undetected. Some referees halt play while others let it go on.

Even the players have had enough. “On a macro-basis, we’re very supportive of reform,” said Tim Ryan, president and chief executive of the Securities Industry and Financial Markets Association.

In devising new regulations and oversight, the administration is looking to address four perceived weaknesses in the current system:

• The lack of an all-seeing federal entity to detect institutional stresses that threaten the financial system, and the government’s inability to step in and unwind large institutions before they choke the system.

• The undercapitalization of large financial institutions.

• The emergence of large, lightly regulated markets, such as hedge funds, and of big insurers, such as AIG, without a federal overseer.

• Consumers and lenders whose unwitting or reckless credit and borrowing decisions placed families under staggering debts and contributed to the instability of the financial system.

Internally, the administration has vacillated over whether to streamline the vast array of regulatory agencies. The administration considered merging the Securities and Exchange Commission, the powerful stock market regulator, and the Commodities Futures Trading Commission, which oversees commodity futures and some options markets.

But the move would have meant congressional and regulatory turf battles. At a dinner two weeks ago, Treasury Secretary Timothy Geithner told key lawmakers he would not propose the merger.