The new rules are a start. I have already written more than enough about crushing the peer to peer OTC system in the trading of "exotic" financial instruments. The Clearing house idea is a start.
What I haven't read, however, is the simplest but most necessary reform of this bilious system. More money for the SEC. Much more money. Three times the funding it gets now at the very least. Some protocol for allocating funding so that the SEC cannot be threatened by the stray bribed senator. An increase of SEC personnel by at least a couple of thousand. Again, the increase should be dictated by the size of the sector to be regulated. If all regulations simply remained the same and the SEC was inflated to a size commensurate with the work it should be doing, we would already have avoided a couple of turns on the slide into the pit. After Bear Stearns fell, amazingly, the SEC did nothing. They sent nary a forensic accountant nor a lawyer into Lehman Bros, Goldman Sachs, Merril etc. etc. In those six months, the zombies and their enablers should have been thoroughly anatomized. They haven't been yet. They may not be ever. And this intentional mystery - mysteries and enigmas are what the Street lives on, now - persists as an elite defense mechanism, against all comers.
More light, as Goethe said, and died. More light.
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