It’s a Bird…It’s a Plane . . . No, it’s Spitzer to the Rescue

[Crewleader]

It’s a Bird…It’s a Plane . . . No, it’s Spitzer to the Rescue

by Mike Whitney / April 2nd, 2009 (4)

If Obama was serious about restoring confidence in the markets, he’d dump SEC chief Mary Schapiro and replace her with Eliot Spitzer. That would send a message to the world that the administration means business. Schapiro is another Wall Street toady who believes in “self regulating” markets. Right. As the head of the Financial Industry Regulatory Authority (FINRA) she twiddled her thumbs while the financial giants increased their leverage to gigantic levels and spread their derivatives contagion to every part of the system.

Schapiro also missed the Madoff scandal, the auction-rate bond fraud, the blow up at Lehman Brothers, and the mortgage meltdown. She was blindsided at every turn. Her dismal performance as a private-sector regulator proves that she’s the wrong person for the job. Even the far-right Wall Street Journal has lambasted Schapiro. In an article titled “Obama’s pick to head SEC has record of being a Regulator with a Light Touch,” the WSJ relays this revealing anecdote:

The Financial Services Institute, a trade group, was meeting, and Ms. Schapiro addressed the crowd about Finra’s efforts to fight frauds aimed at senior citizens. Frank Congemi, a financial adviser, asked what Finra was doing to regulate “packaged products” such as complex mortgage securities. Mr. Congemi says that Ms. Schapiro replied: “We have rating agencies that rate them.” The credit-rating agencies, by this time, were being heavily criticized for having given triple-A ratings to mortgage bonds that became unsalable as foreclosures rose.

Mr. Congemi says that at the May 7 meeting he retorted: “What is that going to do to markets and people’s trust when these things go to zero?” He says Ms. Schapiro replied that she couldn’t answer hypothetical questions. (Wall Street Journal, “Obama’s pick to head SEC has record of being a Regulator with a Light Touch”)

This story sums up Schapiro’s “do nothing” attitude perfectly: plenty of posturing and rhetoric with zero enforcement. She’s doomed to follow in the footsteps of her feckless predecessor, Christopher Cox, who stuck his head in the sand while the 5 biggest investment banks levered up to 30-to-1 and brought the whole global house of cards crashing to earth. Schapiro will undoubtedly torpedo any effort to police the markets or to bring charges against any of the Wall Street Godfathers.

http://dissidentvoice.org/2009/04/its-a-birdits-a-plane-no-its-spitzer-to-the-rescue/

[Muttocracy]

1. good article - be sure to read all of it at the link. nt

[JDPriestly]

2. K&R

[Tiggeroshii]

3. What are the chances that would happen?

Considering how spitzer went out?

[progressoid]

4. Slim..

to none.

[FreeJG]

5. right....that's why they got him with hookers

[Warpy]

6. Word

I can't disagree with a single word in that OP.

It's probably why they nailed Spitzer with that stupid sex scandal in the first place.

He'd make that Schapiro female look like the twit she undoubtedly is.

Eventually he will have to be brought in, probably behind the scenes.

The mess is just too big to sweep under a rug and it's far from over yet.