Saturday, September 27, 2008

Fire Paulson Fire Cox

The reason Bush should fire Paulson is he and his investment bank buddies created the financial mess.

The federal government admitted it in the New York Times story "S.E.C. Concedes Oversight Flaw Fueled Collapse." The Security and Exchange Commission (the SEC) was passed during FDR's presidency to regulate Wall Street and was supposed to save the country from out-of-control greed, speculation and manipulations of the 1929 stock market crash. The SEC was supposed to regulate Wall Street, but following the Reaganomics voodoo economics of the last 3 decades. they didn't regulate. Instead Bush II appoints Christopher Cox to chair the SEC, but Cox like Bush and like McCain is a long-time foe of regulation. It's just like letting the fox guard the hen house. In 2004 the SEC, not interested in any real regulation of investment banks, instituted a "voluntary supervision program for Wall Street's largest investment banks" and now Mr. Cox admits his voluntary program "had contributed to the global financial crises, and he abruptly shut the program down" (New York Times, 9/27/08).

Mr. Cox said his voluntary program was "fundamentally flawed the from the beginning" because investments banking companies could join or withdraw from the program at will. Besides, the SEC in a just released report said that it didn't failed to monitor Bear Stearns before it collapsed.

The 5 big investor banks lobbied for the voluntary commission, and who was head of Goldman Sacks at the time? Mr Paulson, now head of the Treasury Department. So Mr. Paulson helps set up the voluntary commission at the SEC that helps crash Wall Street. The SEC gave into the lobbying of the 5 investment banks including Mr. Paulson at Goldman Sacks.

But there's more. The 5 investment banks wanted SEC as their umbrella regulator "because that let them avoid regulation of their fast-growing European operations by the European Union." So this voluntary commission was set up to avoid regulation by European Union. Now Mr. Cox admits that the SEC's regulation was non-existent and was put into place at the request of the investment banks who had collapsed or been sold.

Mr. Paulson is one of the people most responsible fore creating this Wall Street financial crises. He should be fired. Mr. Cox also by his negligence helped the crises develop. He should be fired.

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