4 ms·

Why aren't you blaming the SEC (FDA counterpart in this analogy) for 2009 events as well?

• afterburner 10y ago
  Do you support vastly expanding SEC powers and making sure it doesn't get "captured" by the financial industry? Do you support massively higher penalties, and far more control over the industry, than it has now, to bring it in line with the power the FDA has? Do you also only blame the police for not catching a criminal, and not care about the criminal at all?
• generj 10y ago
  The SEC failed to enforce some of it's regulations and didn't see the upcoming crisis. Multiple other federal agencies did the same thing. Not a single government official from any country (remember that a similar housing boom unfolded in multiple other countries) foresaw the upcoming trauma. Note that it it was likely politically infeasible for them to have more rigorously enforced much of their regulation during most of the time period it could have helped. The new securities which caused the crisis were very complex and partially were structured specifically to dodge government oversight. The ratings agencies actively marked bonds as AA which they knew darn well were in reality B or worse. They committed fraud at the behest of the banks. There is a massive difference between inaction and fraud. That's why the SEC doesn't get a lot of blame.