Tales from the Trail

What did you expect from a financial meltdown hearing?

January 14, 2010

If anyone was looking for Wall Street executives to say “sorry” at the financial meltdown hearing, they would have been disappointed. FINANCIAL-COMMISSION/

If anyone was looking for the Justice Department to offer a firm “Yes” to the Financial Crisis Inquiry Commission‘s request for sharing information, they would have been disappointed. (Attorney General Eric Holder did pledge cooperation).

But one commission member declared “this is the happiest day of my life” (we’re thinking perhaps he needs to get out more).

Doug Holtz-Eakin thanked the panel of regulators for resolving whether the “uptick rule matters, whether short sellers ruined the world, and how much mark-to-market accounting matters.  I have been waiting for this day and look forward to your reports.  It’s going to be wonderful.”

But another commission member was totally unimpressed with the “uptick rule” and asked the SEC chief for a memo from the agency’s economist on it.

“Many people care very deeply about it on both sides,” SEC Chairman Mary Schapiro said.

“Right. And I can’t figure out why,” commission member Keith Hennessey responded.

OK then.

(In full disclosure I am not an expert on the uptick rule, but my colleagues tell me it was adopted after the 1929 stock market crash and abolished in 2007 by the SEC which concluded it was ineffective in restraining certain types of trading.) OBAMA-BANKS/ANNOUNCEMENT

The White House believes Wall Street firms owe an apology for the financial mess.

White House spokesman Robert Gibbs said on Wednesday about the Wall Street officials testifying at the commission hearing:  “It would seem to me that an apology would be the least of what anybody might expect.”

President Barack Obama on Thursday, in proposing a fee on the biggest banks to recoup the financial bailout, said Wall Street firms should roll back bonuses for top earners and executives and “embrace, rather than fight, serious financial reform.”

Let us know where you stand on the Obama bank fee, the uptick rule, and a Wall Street apology.

Photo credit: Reuters/Jason Reed (Attorney General Holder preparing to testify at commission hearing), Reuters/Jim Young (Obama urges Wall Street to roll back bonuses)

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I believe everyone is looking for prosecutions (i.e., just like Bernie Madoff)!

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