One year after the beginning of the end of Wall Street as we know it, the future of regulation, the stability of the banking system and the fortitude of the economy and the stock market are still a big question mark.

Sure, some would say that the true anniversary was March 14, a year after the government bailed out Bear Stearns, the first real sign that the system was on the verge of collapse. But widespread financial panic didn’t begin in earnest until the government allowed Lehman Brothers, one of Wall Street’s oldest and most storied firms, to go bankrupt on September 15, 2008.

In the ensuing weeks and months, a string of large financial institutions imploded. And so the government shifted into stimulation mode, printing money and throwing billions in taxpayer funds to bailout 693 (so far) institutions, the distribution of which is only now being fully accounted for. Meanwhile, credit markets froze, but have since thawed a little; equity markets tested 12-year-old lows before rebounding in dramatic fashion since March of this year. (On Tuesday, stocks reached new highs for 2009.)

By some measures, the recession is in fact over, Ben Bernanke said Monday in a speech to the Brookings Institution. (So, props to Helicopter Ben for that, we suppose.) But don’t get too excited. Bernanke and others, like San Francisco Fed President, Janet Yellen, and Northern Trust economist, Paul Kasriel, have warned that the recovery will be slow and the system is still vulnerable; high unemployment will linger.

By other measures, the American economy is still on life support and many economists and commentators are worried that adequate systemic regulatory changes are not being made to avoid a repeat of the past year and a half. (Of course, it’s hard to see how the Fed, which missed the tech bubble, then the credit bubble, would catch the next one, even with more power. But then, there are plenty of other proposals on the table too, which could reign in risk taking or at the very least increase transparency.)

The salubriousness of the government’s remedies, not surprisingly, is being hotly debated. To sum it up, the Keynesians, in retreat for the past 30 years, are in full voice, feeling vindicated. Free marketers and Milton Friedman devotees, on the other hand, say the government is now sowing future economic catastrophe by spending money that the nation does not have.

This argument is wonderfully distilled by two of today’s most prominent pundits, Princeton’s Nobel laureate, Paul Krugman, and Harvard’s Niall Ferguson; they are the living symbols of the two sides carrying out public battles over the usefulness and purpose of the U.S. government’s spending. Last Sunday, in the New York Times Magazine, Krugman criticized the entire economic discipline for missing the credit bubble. (Not surprisingly most of his criticism was aimed at what he called his “freshwater” colleagues—i.e. University of Chicago neoclassical economists—who subscribe to efficient market theory and dismiss the writing of Lord Keynes. (Efficient Market Theory has indeed taken its lumps since the financial crisis. Registered Rep. wrote about the related battle between Modern Portfolio Theory and Post Modern Portfolio Theory in July and the virtues of tactical asset allocation in August.) Ferguson, a prolific historian teaching at Harvard, warns that the federal government is bankrupting the nation and will cause rampant inflation years on.

Of course, most everyone, from Libertarians to Lefties, think the financial system is in need of financial reform—but what kind? Therein lies the conundrum. We got the first official glimpse of the presidential view of what’s needed on Monday from President Obama in a speech at Federal Hall in New York in which Obama also defended the government’s actions over the last 12 months.

But critics say the president’s agenda still doesn’t address some key issues; or worse, some of the reforms are misguided and will be ineffective or harmful, they argue. Nouriel Roubini, the once obscure NYU economist who has risen to fame during the crisis, outlined what’s different and what’s the same since Lehman collapsed in his weekly RGE Monitor’s Newsletter.

Some differences
: Group of 20 finance ministers vow to align compensation with long-term performance of banks and increase capital adequacy requirements; Recognition that derivatives can have an economic impact and there should be a central, transparent clearing platform to reduce systemic risk; economists are suggesting that economic models should include the financial sector, credit markets and asset/collateral prices [They didn’t do this before?]

Some things that are the same or worse
: Too-big-to-fail banks are even bigger; $657 billion in toxic assets are still on bank books; with no disciplining mechanism, value-at-risk (VaR) measures were back to record levels for the top 5 banks in the second quarter, with $1 billion at risk of loss on any given trading day; structural reform proposals including legislation proposing a systemic risk regulator (Fed or Systemic Risk Council) and Consumer Protection Agency are stalling in Congress or getting hammered by lobbyists.

Creating a two-tiered banking system, with some banks falling into the systemic category, as Obama’s plan proposes, is hardly enough, according to a broad spectrum of economists. In fact, “too big to fail” is a widely disliked concept that would result in another crisis and subsequent taxpayer funded cleanup, according to a long list of prominent thinkers.

Nobel Prize winning economist, Joseph Stiglitz, as well as current economic advisor to President Obama and former Fed Chairman, Paul Volcker, have advised the president that the largest banks need to be downsized. Yet, that idea doesn’t appear to be getting traction anywhere. Stiglitz offered as a partial explanation recently in an interview with Bloomberg that lobbyists were successfully defeating the idea, which he called “an outrage,” especially since they’d received billion dollar bailouts.

Libertarian economist, Mark Calabria, writing for The Cato Institute, said, “Rather than ending ‘too big to fail,’ the President wants us to believe that with additional discretion and power, the same Federal Reserve that missed the boat last time will save us next time.” If Fannie and Freddie aren’t fixed, subsidies for leverage in our tax code not scaled back, if monetary policy isn’t reined in, “it will only be a matter of time before the next crisis hits,” Calabria says.