| |||||||||||||||||||||||||
| |||||||||||||||||||||||||
 As voters go to the polls, the economy and Wall Street's financial
problems continue to weigh heavy. So it's no wonder that lame duck Securities and
Exchange Commission Chairman Christopher Cox chose Election Day to
defend in a Washington Post opinion piece his agency and also urge the next administration to reform the regulatory system.
"The global financial crisis has exposed many of the weaknesses and
holes in our regulatory system that are far greater and more
consequential than was previously understood. The priority now must be
to address those issues and rationalize that system," Cox wrote.
The current SEC chairman also writes that the most visible gap is in the credit default swap market, which has no oversight and lacks transparency. CDSs have been famously opaque with little known about their terms. They work like an insurance policy against a debtor defaulting on payment of its bonds, allowing the bondholders to claim that the risk from their bond holdings has been transferred although they still hold the asset. Regulation in this area could come sooner rather than later if all the agencies involved forgo political posturing and jurisdictional turf battles -- but if history is any guide, that's not likely to happen. Nonetheless, Cox is reiterating his call for the SEC and the Commodities Futures Trading Commission to combine into a single agency with a clear mandate to protect investors by regulating the markets in all financial instruments, including securities, futures and derivatives. Meanwhile, neither Sen. Barack Obama's nor Sen. John McCain's presidential campaign has offered specifics on new rules it might craft or who would even replace Cox. Republican hopeful McCain said he would fire Cox, but he also called for former SEC chief Harvey Pitt to be fired in 2002 after the WorldCom Inc. debacle. Pitt resigned four months later, and Cox has always been clear about his intent to leave the SEC when the Bush administration ends in January 2009. Cox's term officially ends in June 2009, but he could stay on until a successor is named. As for Obama's likely SEC chief, so far only two names have been bandied about as front-runners. The first is New York Attorney General Andrew Cuomo, who was first floated as a candidate for the SEC post by McCain during a television interview. The other is Elisse Walter a newly seated Democratic commissioner, who is uniquely qualified to oversee a merged SEC/CFTC because she spent dozens of years working at both agencies, including a stint working as deputy director of the SEC's Division of Corporate and a general counsel at CFTC. In the end, however, we may have to wait for Cox's replacement because traditionally an incoming president usually picks an SEC chair within six months of taking office. - Donna Block See Cox's op-ed story from The Washington Post Categories Deal Video
    Community
 Elsewhere on The Deal.comDealwatchThe Deal MagazineCorporate Dealmaker
The Deal VideoCategories
Blog roll
Archives
| |||||||||||||||||||||||||
|
|
|
|
|
©Copyright 2009, The Deal, LLC. All rights reserved. Please send all technical questions, comments or concerns to the Webmaster.
