Taking hands-off to the extreme.
Fox Business: New details in a report on the collapse of Bear Stearns released by the Office of the Inspector General overseeing the Securities and Exchange Commission, shows not just how dangerously lax the SEC’s oversight of Wall Street really was.
It also gives damaging evidence that the SEC’s hands-off approach helped cause the credit bubble to dangerously inflate.
Specifically, the Inspector General’s report, which is based on internal SEC memos, shows that the SEC did little to stop a debt load that has decimated Wall Street and caused an historic market crisis that is remaking the entire U.S. financial system.
The Inspector General’s report, now on Sen. Charles Grassley’s Web site, provides fresh detail on the SEC’s laidback oversight of Wall Street. It comes as the government has enacted a massive $700 bn bailout plan.
More than three times that sum is being pumped into the markets by the Federal Reserve, as Wall Street’s disastrous foray into subprime derivatives has caused the profits earned during the bubble, as well its capital, to go up in a puff of smoke.
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