Posts Tagged ‘SEC’

SEC Issues New Rules to Prevent Naked Short Sales

By: ispeculatornew | Date posted: 09.17.2008 (2:04 pm)

Today the SEC announced that it has issued new rules to prevent naked short selling. This is a good step. However, these new rules will be useless if the SEC, Wall Street’s whipping boy, doesn’t actually enforce the rules. I hope the SEC is serious about stopping naked short sales and other abuses on Wall Street.

No Sympathy For Financial Companies

By: ispeculatornew | Date posted: 07.20.2008 (1:05 pm)

There have been a lot of dramatic steps taken by the Fed and the SEC to prevent the deserved collapse of some banks. While I understand that they don’t want to see a run on the banking sector I don’t think that would be the case if the market were left to sort things out on its own. The banks that took excessive risk and leverage would be in trouble and the banks that managed their risk and leverage would be fine. In fact the actions taken by the Fed and the SEC are doing more harm than good.

First, the Fed and the SEC are sending the message that financial institutions can profit from excess risk when times are going good and not have to face the consequences of their actions when times turn bad. This is a terrible message to send and it is only going to lead to the same problems in the future. Banks will have no deterrent from taking the same risks in the future if they know that the government is going to bail them out with taxpayer money when the risks turn sour. (more…)