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Posts Tagged ‘future of financial regulation’

Profiting from Political Intelligence

Posted by Larry Doyle on February 16th, 2012 9:54 AM |

Gaining sensitive, market moving information is NOT by its very nature illegal or unethical. In point of fact, those who are ingenious and industrious enough to outwork and outsmart the competition are fully deserving of the benefits and rewards that come their way.

That ingenuity and industriousness are cornerstones of capitalism. I love it and commend those who ethically pursue these paths to success.

That said, how are these pursuits regulated? Who is monitoring the exchange of what might be exceptionally sensitive and insider information? Great questions. (more…)

Wall Street vs Main Street: The Great Divide Widens

Posted by Larry Doyle on August 4th, 2009 8:01 AM |

Please rank the following professions in terms of commanding respect:

1. used car salesmen
2. lawyers
3. Wall Street
4. dog catchers
5. burglars
6. politicians

Plenty could argue that dog catchers would command the most respect, with burglars a distant second. How so? At least you know exactly what their intentions are, admirable or not, and manage accordingly.

With all due respect to quality individuals in the other professions, those industries as a whole have always suffered from a very poor public perception.

Moving to the fully serious part of my writing this morning, I would venture to say that the chasm which has always existed between Wall Street and Main Street has never been wider and is widening by the day. How so?

I am being inundated regularly with comments and questions as to whether the market is truly representative of the fundamentals in the underlying economy. Others have asked me how an industry that is supposedly once again making sizable profits can shamelessly impose credit card rates of upwards of 30%!!

It is my sense that the American consumer and investor feels woefully neglected at this point in our country’s history. As such, I have little doubt that many people have exited the markets with the intention of NEVER returning.

I would not pretend that I can appreciate the level of anxiety and disgust of everybody in our country today, but I share your contempt for a crowd both in Washington and on Wall Street that has done little to nothing to protect your interests.

This contempt welled up this morning as I read The Wall Street Journal’s, Geithner Vents at Regulators as Overhaul Stumbles:

Treasury Secretary Timothy Geithner blasted top U.S. financial regulators in an expletive-laced critique last Friday as frustration grows over the Obama administration’s faltering plan to overhaul U.S. financial regulation, according to people familiar with the meeting.

The proposed regulatory revamp is one of President Barack Obama’s top domestic priorities. But since it was unveiled in June, the plan has been criticized by the financial-services industry, as well as by financial regulators wary of encroachment on their turf.

While I could wax poetic on the topic of regulatory reform, I will abbreviate my remarks with a very succinct and direct statement: “THESE PEOPLE DON’T GET IT!”

The fact remains, “Future Financial Regulation: Not a Question of Sufficiency, but of Transparency and Integrity.”

Does the American public understand how thay have been abused by both their political and banking representatives? I strongly believe they are gaining a greater awareness of this phenomena every day.

In coming full circle, my respect rankings from top to bottom would be:

1. dog catcher
2. burglars (at least you know their intentions)
3. used car salesmen
4. lawyers
tie for 6th between politicians and Wall Street

How about you? Please share your thoughts and rankings!!

LD

FROM THE ARCHIVES . . .
Future Financial Regulation: Not a Question of Sufficiency, but of Transparency and Integrity

Posted by Larry Doyle on June 15th, 2009 5:30 AM |

I hope people far and wide will listen to the interview I had with Bill Singer on last evening’s NQR’s Sense on Cents with Larry Doyle. Bill is the preeminent veteran Wall Street regulatory lawyer and market reform advocate. He pulled no punches in our conversation. My chat with Bill compels me to republish my posting from mid-May on the future of financial regulation.

Editor’s Note – this piece was originally posted on May 18, 2009:

Will our future regulatory structure of the financial industry allow capitalism to thrive? Will the political wizards in Washington prioritize personal agendas and expediency over unquestioned transparency and integrity? I believe we are at a critical regulatory crossroads not seen since financial regulations implemented in the Securities Act of 1933.

Do the powers that be both in Washington and Wall Street understand the magnitude of responsibilities and obligations involved in this process? Initial returns are decidedly mixed. The debate by those intimately involved in the regulatory oversight is typically framed as a question of sufficiency. That is, does the industry have enough regulation or not?

The media often frame the debate in political terms between laissez-faire proponents and those favoring increased government intervention. Both camps are missing the bigger picture, because both camps are feeding from the same trough. Allow me to expound.

The critical regulatory question facing our markets is not of sufficiency but is one of transparency. Regrettably, both ends of the regulatory spectrum do not want to address this glaring shortcoming because it exposes the very nature of the incestuous relationship between Wall Street and Washington.

The mainstream media, to a large extent, is dependent on both Wall Street and Washington for their financial well being so they do not press or pursue the need for total regulatory transparency. Fortunately, Sense on Cents and other leading financial websites are not under this restriction.

Let’s dig deeper and review where regulatory developments stand currently. As the Financial Times reports, U.S. Poised For Finance Regulation Shake-Up:

Congress will next month start the biggest regulatory overhaul of the US financial system in decades, bringing into the open a frantic lobbying effort between banks, regulators and policymakers on what it contains and who pays for it.

The House financial services committee, chaired by Democrat Barney Frank, will hold hearings early in June into reforms outlined by Timothy Geithner, Treasury secretary, say people familiar with the timetable.

Regrettably, before the debate even begins the premise of sufficiency versus transparency is accepted without question. Well, Sense on Cents is questioning the lack of transparency and resulting integrity of the process, which by its very nature strongly influences the outcome. Allow me to be more specific. Much as the Parliament in the U.K. is being rocked by a current scandal over expenses submitted by legislators, I strongly exhort those who truly care about capitalism, free market principles, and our democracy to address the very nature of the relationship betwen the banks, regulators, and policymakers. (more…)






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