Henry Paulson Tenure with Goldman Sachs In 2004, at the request of the major Wall Street investment houses, including Goldman Sachs, then headed by Paulson, the U.S. Securities and Exchange Commission agreed unanimously to release the major investment houses from the net capital rule, the requirement that their brokerages hold reserve capital that limited their leverage and risk exposure. The complaint that was put forth by the investment banks was of increasingly onerous regulatory requirements -- in this case, not U.S. regulator oversight, but European Union regulation of the foreign operations of US investment groups. In the immediate lead- up to the decision, EU regulators also acceded to US pressure, and agreed not to scrutinize foreign firms' reserve holdings if the SEC agreed to do so instead. The 1999 Gramm-Leach-Bliley Act, however, put the parent holding company of each of the big American brokerages beyond SEC oversight. In order for the agreement to go ahead, the investment banks lobbied for a decision that would allow "voluntary" inspection of their parent and subsidiary holdings by the SEC.
During this repeal of the net capital rule, SEC Chairman William H. Donaldson agreed to the establishment of a risk management office that would monitor signs of future problems. This office was eventually dismantled by Chairman Christopher Cox, after discussions with Paulson. According to the New York Times, "While other financial regulatory agencies criticized a blueprint by Mr. Paulson, the [new] Treasury secretary, that proposed to reduce their stature — and that of the S.E.C. — Mr. Cox did not challenge the plan, leaving it to three former Democratic and Republican commission chairmen to complain that the blueprint would neuter the agency."[11] In late September 2008, Chairman Cox and the other Commissioners agreed to end the 2004 program of voluntary regulation. And now the fox is in charge of the henhouse. Only in America. On Oct 24, 4:40 pm, Zebnick <[EMAIL PROTECTED]> wrote: > You don't know what you're talking about. If you think you do, > identify what was deregulated and how, specifically, it caused the > mortgage meltdown. > > On Oct 24, 12:49 am, studio <[EMAIL PROTECTED]> wrote: > > > > > On Oct 23, 11:49 pm, Zebnick <[EMAIL PROTECTED]> wrote: > > > > The home foreclosures are courtesy of the Democrat Party. Thanks, you > > > do-gooder jackasses. > > > Actually, it's a courtesy of both major parties and deregulation that > > Republicans > > wrote into law. > > > Deregulation = do whatever you want to do....and they did, cause they > > knew > > government socialists would bail them out. > > > And Bush Jr. did. > > > Stop being naive and ignorant ideolog.- Hide quoted text - > > - Show quoted text - --~--~---------~--~----~------------~-------~--~----~ Thanks for being part of "PoliticalForum" at Google Groups. For options & help see http://groups.google.com/group/PoliticalForum * Visit our other community at http://www.PoliticalForum.com/ * It's active and moderated. Register and vote in our polls. * Read the latest breaking news, and more. -~----------~----~----~----~------~----~------~--~---
