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Crisis Yields Turnabout by SEC Chair

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4 Responses

  1. Mark Edwards says:

    Wow! That is VERY surprising. I suspect that when he suggests merging the SEC and CFTC, he really means letting the SEC capture the CFTC and moves its function in-house.

    *I also suspect that having his reputation blistered — by his own party — for conditions he couldn’t control, might lead him to regulatory policy re-awakening.*

  2. A.J. Sutter says:

    Do I understand correctly that he proposes to eliminate all bank regulation by states?

  3. Carol Cross says:

    Chairman Cox, when he spoke to the Securitisation Seminars and Conferences always complimented this sector on the advantages that securitisation had provided to our economy

    However, he always warned the audiences to be on the outlook for fraud and to report fraud to the SEC. Apparently, Chairman Cox was aware that current law and regulation would or could be manipulated to commit fraud.

    Apparently ENRON did not wake up the regulators ENOUGH to the dangers of “off balance” accounting and special off-shore vehicles, etc… and tax avoidance, etc… The accounting changes didn’t do the job. The Congress apparently didn’t understand the problem.

    Apparently Chairman Cox didn’t realize that the Rating Companies were also interested in “product” to feed their bottom lines, and a lot of “shit” was sold to innocent investers because the rating agencies were not rating the securities in terms of the possible risks in down markets. The inflation in the rating of securitizations contributed to the losses suffered by institutional investors like pension funds for teachers and policemen and cities, etc..

    The “inflation” in the ratings process that complemented the production of “new” financial products has a price that will be paid by those on Wall Street and the American people.

    It will be a long time before a politician advocates the abolishment of Social Security for private investment in the free market economy of the United States.

    What brought the great Bull down. Is betting on the future of cash flows really very risky and were the regulators, the SEC, and the Treasury Department aware of all of the bad bets that were being made because these bets were allowed under law and ineffective regulation?

    Chairman Cox did not promulgate law and regulation and was charged with implementing current SEC Law. Chairman Cox has learned a lot from the wounding of the great BULL OF WALL STEET, and he understands probably better than anyone how and why this crisis is upon us.

    I hope that Senator Obama will consult with Chairman Cox and the other regulators and the Federal Reserve directly in the process of forming his own opinion as to the causes of the current crisis in our economy.

  4. J. Gaglani says:

    He had to say something.