Christopher Cox, the chairman of the Securities and Exchange Commission and a longtime proponent of deregulation, acknowledged on Friday that the voluntary supervisory program of Wall Street’s largest investment banks had contributed to the global financial crisis and abruptly shut the program down.
The agency’s oversight responsibilities will largely shift to the Federal Reserve.
The commission’s inspector general, in a report also released on Friday, strongly criticized the agency’s performance in monitoring Bear Stearns before it collapsed in March. Mr. Cox said he agreed that the oversight program was ‘fundamentally flawed from the beginning.’
It’s time to end the conservative experiment.
Christopher Cox and Henry Paulson are wrong.
Dead wrong.
It was The Federal Reserve pumping money into the economy by encouraging credit creation that caused the housing bubble and it burst when Bernake raised interested rates.
You can see a correlation with this compared to other economic downturns like the stock market collapses of 2000 & 1987 and with inflating housing prices and collapses like what happened prior to the period known as The Great Depression.
De-regulation means consumers have more choices with the kinds of products and services they want with less government interference.
I think you should ask yourself if people are better able to choose what kind of things they want to buy or should some one else (in this case government officials) do it for them.
As long as you have a monetary system geared to where you can print money or create credit out of thin air more events, like what is happening now, will occur again.
Wait a minute, do you really believe more regulation means the government will make choices for us? Come on, who is talking about regulating our choices with the kinds of products and services we want? That’s just some scare tactics big corporations on Wall Street use to rally us behind them to get rid of regulations that guard THEM against taking excessive risks/being excessively greedy.
The fact is, they did take excessive risks over the past 8 years under Bush – because of deregulation – which results in this huge financial mess today.
I recommend that you read today’s top story on New York Times (online edition). What happened was, in 2004, the five major investment banks wanted further deregulation. And they demanded to be exempt from a regulation stipulating their capital reserve levels. The SEC did give them the exemption and let them self-regulate how much they wanted to keep as reserves. As a result, they all lowered their capital reserve levels and took excessively high risk in buying mortgage-back securities. That is how they brought themselves down, and that is how deregulation brought not only them but all of us in Main Street down!