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John McCain singles out a fellow Republican for blame in Wall Street meltdown

Faced with a complex, bewildering and downright scary crisis -- i.e., the turmoil now afflicting Wall Street -- politicians often find it convenient to identify a specific villain whom they can thrash for effect. Securities and Exchange Commission Chairman Christopher Cox came under attack from Republican presidential nominee John McCain

For Democrats, that target almost always is President Bush (it goes with the turf; the buck does stop in his office). But even for self-proclaimed maverick John McCain, it would be impolitic -- as the Republican presidential nominee -- to call out the Republican currently residing in the White House.

So McCain, speaking today in Iowa, singled out a different federal official: the chairman of the Securities and Exchange Commission.

His critique was harsh: "In my view," he said, the SEC chairman "has betrayed the public trust" by failing to adequately regulate America's high financiers, McCain said.

And his remedy was direct: "If I was president today, I would fire him."

McCain did note that the chairman is a presidential appointee, though he avoided mentioning the particular president who put in office the fellow he so disdains. But other omissions were more telling.

Aside from not naming the chairman -- Chris Cox (above) -- McCain neglected to tell his cheering audience that this benighted public servant brought a sterling, and solidly Republican, resume to his job when he assumed it in August 2005. Cox was a one-time legal aide in Ronald Reagan's White House who, staring in 1989, represented an affluent House district in California for many years (its core was Newport Beach). In Congress, he was a major player in formulating GOP policy, including a generally hands-off regulatory approach to business that McCain also advocated.

Here's more on Cox's background: After whisking through the University of Southern California in three years, he earned both a master's in business administration and a law degree from Harvard. While still in the House, the Almanac of American Politics wrote that his "intellect and range of interests are impressive."

Cox was confirmed for the SEC post on a voice vote -- with nary an objection heard -- by the Senate. The chamber's members included McCain and Barack Obama (though we do not know whether either were on the floor at this moment).

No reaction yet from Cox to McCain's attack on him. But boy, wouldn't we love to know who he ends up voting for later this year (maybe he'll pass on the presidential part of his ballot).

-- Don Frederick

Photo credit: Bloomberg News

 
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I'm not sure. Can the president fire the SEC chairman during his five year term, after appointment and confirmation by the senate? Or does he have to wait until the end of the term and not reappoint him?

John McCain doesn't give the SEC Chairman any credit for the "fundamentals" of the economy being so "strong"?

Next McCain will have to fire himself.

Cox is only supposed to be the enforcer of the rules, which McCain and his pal Phil Gramm have removed. Cox has essentially nothing to do. McCain has only himself to blame for that.

This is all red meat to throw out, so he can pretend to be a maverick.

Currently, McCain has more to worry about. Like being relegated to #2 on his ticket by his running mate.

Palin's reference to a Palin/McCain ticket is pretty funny.

For those who haven't seen it, I have the clip:
http://scootmandubious.blogspot.com/2008/09/palin-touts-palin-mccain-administration.html

Just last week McCain was railing againist the regulations on the stock market and banks put in place in the 1930's as against the free market. Yet today he is going to fire Cox for throwing out a regulation that was put in place in the 1930's to prevent another 1929 crash. Come on McCain get on one side ot the issue or the other...this tennis match is giving me neck cramps. Are you a true conservative or a neocon?

The blame goes not only to the SEC, but the GASB, the IASB, the AICPA, and the Department of Commerce, Interior, Justice, HUD....you name it. The accounting profession caved in to the charlatans who invented "off balance sheet" transactions, top-side entries, and any other accounting device that obscured the truthfulness behind these "ghost" assets.

McCain is obviously trying to deflect blame from his former economic advisor Phil Gramm. Gramm has rightfully gotten a lot of criticism for his bill " The Financial Modernization Act "of 1999, also known as the "Gramm-Leach-Bliley Act" . This was the bill that deregulated the banks, which led to the subprime and credit meltdown that is now at the root of our economic woes.

Before Gramm started getting a lot of bad press this summer due to his leadership in deregulating the banks, he was McCain's main economic adviser and was thought to be the frontrunner for McCain's pick for the Secretary of the Treasury. McCain has recently been distancing himself from Gramm (they used to appear at events together all the time), but McCain is on the record as a big fan of Gramm's views on economics.

This is such a shallow attempt to look like the Maveric he wants everyone to think he is. It's real easy to point fingers and say I would fire this guy when you don't have to act on your attacks. The fate of Wall Street cannot just fall on the shoulders of one person. The entire Hands off philosophy toward the market of the republican party has aided in this catastrophy. Yes the same philosophy that McCain himself subscribes to and would maintain as President. So advise to McCain, we see through the gimmicks, all of them. You are not a Maverick, either is Palin, so stop trying to force it down our throats.

This is ridiculous!!! As much as I disliked Cox when he was a congressman, I think he was the perfect fit for the head of the SEC. MaCain is is looking for someone to blame, but he is picking on the wrong person.

It seams to me that the democractes are the ones
in the Senate and Congress running things,
So ,why would you want a democrate for president
this reminds me when Jimmy Carter was in office and
the republcans had to fix the dem. misstakes in the Congress
Senant and President . Since , then I have been voting republican
and never look back

How about McCain adviser Phill Gramm? Read Froma Harrop.

Why would America REWARD complete Republican failure ?

We wont.

How long before a staffer whispers in McCain's ear the fact that the SEC chairman does not oversee banking or insurance?

Here's another guess-the-number-of-jelly-beans question: after making a fetish of deregulation for the past thirty years, how many times will Republicans demand increased regulation this week, and without even blushing?

Headline should have been, "Republicans eat their young!" Everyday Mr. McCain is showing himself to be exactly what he claims he is not, an Old School and unprincipled politician. He is destroying his reputation over his need to be in the White house. I am sure people a lot smarter than I am can point to clear examples in history and literature that would best describe what we the people are a witness to. It is unfortunate for Mr. McCain, however it is a blessing for the country.

Did McCain just tell us that we should fire McCain for having such failed ideas?

Or is he saying that even though he would have done the same exact thing, he's not to blame because he wasn't in charge?

I wonder if it was coincidence that McCain's first two very specific proposals (firing Chris Cox & creating a 'mortgage and financial institutions trust') were the same two that Ben Stein articulated last night on Larry King, after a blistering assessment of the Bush administration's oversight failures. I have no doubt that Ben Stein understands the origins of the mortgage crisis and what wasn't done about it that allowed it to reach this point. But I don't believe McCain has a clue, and this smacks of plagiarism and posturing to me. How does a credible candidate for President go from "I'm going to appoint a commission to study the matter..." one day, to "I'm firing Chris Cox..." the next? (Probably the same way he selected his running mate.)

Stein also had harsh criticism of "whoever they have giving him (McCain) advice". Stein said he would like to give McCain a crash course in economics by sequestering him with Warren Buffet for a day or so, but that wasn't possible since Buffet is supporting Obama.

I also looked into McCain's co-sponsorship of a bill in 2005 which would have overhauled the oversight structure for Fannie Mae & Freddie Mac. In his brief endorsement of the Bill (which I believe was never voted on), he described very accurately some of the conflicts of interest and cooking of books which created a dangerous liability for taxpayers:
(http://www.govtrack.us/congress/bill.xpd?bill=s109-190)
(http://www.govtrack.us/congress/record.xpd?id=109-s20060525-16&bill=s109-190)

I'm no expert, but as I read this record, the bill was reported out by the Senate Banking committee favorably July 28, 2005, when the Republicans were still in control of Congress, but never voted on (Why?). It was re-submitted in 2006, apparently in an attempt to embarrass the Dems and give the appearance that they were the ones opposing more regulation of F&F. (Don't know, were they?)

My question is: if McCain is so outraged now by all of this, why did he do so little about it in 2005 when the R's were in the majority? If he's the Maverick who challenges his own party, and he knew there was a crisis brewing in the mortgage industry, why didn't he make more noise publicly about it than simply entering a statement into the Congressional record?

I've been a voting Republican since 1971, and I always thought McCain was the best our party had to offer. The things he's revealed about himself and his character in particular during these last 9 months are appalling to me, and I'm supporting Obama (so that's my bias). But I think there are some issues of fact here that bear investigation.

Its interesting to see how politicians operate and its not a nice picture. McCain was the champion of deregulation for the last 10 years. In essence McCain helped in way carve the financial crisis we are in today. But, he quickly passes on the blame to a man who's job is the oversight of laws and regulations that come from legislators like Mccain.

Either McCain has alzheimer or he has no clue on what his deregulation laws meant. Either way he should "fire" himself.

Sir,

This hardly shows Mr. McCain is a maverick. He's a loose cannon just shooting anywhere he can. That is just plain poor thinking and not in control of his own behavior. He doesn't even know enough to know how to solve this. He is just shooting out for blame so that he doesn't get the blame and it's going to come back and shoot him in the foot. Oh boy. Come on, this looks bad. I'd be worried how everyone is taking this. We are all shaking our heads. Again, this looks "Quick-to-the-Draw McCain".

The housing crisis was in its terminal stage by 2005, when Cox was appointed.

Is this the change McLame is trying to push, when you sit on the commerce committee for years and push deregulation, he is unwilling to even take any blame for his part in this fiscal fiasco. I bet when McLame voted for NAFTA, CAFTA, and all the other Chamber of Commerce deals to outsource our jobs, he will never admit his part in selling out this countrys workers.

He is just another despictable republican who has shown little leadership and looking to blame others for his failures. 8 Years of Bush and you wont find a republican admitting they have failed this country. ITS NEVER THEIR FAULT. Okay I buy that, I am voting for Obama in November.

McCain can have my vote right now if he pledges to put Bush, Cheney, Rumsfeld and Gonzalas on trial for treason. They belong in prison at the very least. If the scaffold they used on Saddam is still available, so much the better.

Capitalism is the fundamental of our economy. Let change it to communism. Lets put an end to all the evils of this society.

Vote for a "Non-white Guy" just because he is a change from a White guy. Vote for a guy who is dumber than Bush because he represents change.
Don't vote on record. That's change.
Lets change all well to do ppl in America to poor and make the poor the new rich. That is change
Lets rob Paul to pay Peter. That would be change.
Let's replace a dumb President who takes bad decision with one who doesn't take any decision. That's change.
Change my "Posterior"

Hey Richard,

Maybe someone should whisper in your ear it was the large banks that bought tens of thousands of mortgages from small local lending banks, “bundled” them into Jumbo new securities which were then rated by Moody’s or Standard & Poors or Fitch, and then sold as bonds to pension funds or other banks or private investors who naively believed they were buying bonds rated AAA, the highest, and never realized that their “bundle” of say 1,000 different home mortgages, contained maybe 20% or 200 mortgages rated “sub-prime,” i.e. of dubious credit quality.

That certainly falls under the jurisdiction of the SEC.

McCain wants to blame a single preson when his economic agenda has been 90% in line with Bush.....giving tax breaks to corporations, de-regulating them, not promoting transparency and promoting free and unregulated enterprise!!!!!!!!!!!!!.....

McCain, this fall in the dow has refocused people on what really matters.....and right now we need real Change from Obama......your reformer image is tainted and has been on the side of the few against the many....your VP also shares and has been exposed for corruption, lying and irresponsible spending as well....Bush-McCain-Palin = more of the same failed policies

Take a look at Obama's ties to Freddie Mac and Fannie Mae, take a look at "do nothing" Barney Frank who shot down the reform bill Bush and McCain wanted to do in 2003. Barney only wanted bad loans for "affordable housing"

Take a look at Obama's releationship to the Lehman crowd. http://canadafreepress.com/index.php/article/5076
Obama is number 2 in money contributions from Freddie and Fannie Mae sources from 1989 to now in all of congress. AND he has only been in the senate 3 yrs.

Yes, the apple does not fall too far from the tree in Obama's case

Economy Crisis 9/18/2008
It deeply concerns me that our economy is rupturing. In fact, I am extremely fearful of the possible destructive dire consequences if we do nothing until our next President is elected. By eight years of President Clinton and the advice of his economic advisors proved that his economical policies were successful and good for the USA. By the last eight years of President Bush and the advice of his economic advisors, proved that his economical policies were a total failure and were bad for the USA. President Bush currently has a great opportunity to totally put politics aside and in a bipartisan way, have detail discussions with his economic advisors, McCain economic advisors, and Obama economic advisors. I believe that the outcome could prevent our economy from rupturing any further and prevent further destructive dire consequences. By doing this, President Bush would be putting the love of his country first, without any regard to his party or politics. What could be nobler? Bush would be making a bold move, but it would be well worth it. There could be nothing nobler then saving our country economy, from collapsing.

Amazing that McCain chaired the Commerce committee and didn't seem to know exactly what AIG does. One day he says they should not be bailed, and the next day he reverses himself after becoming aware of the implications of not bailing them.

He is a senator? If so, why has he not introduced an emergency bill to clean up the mess and fire this guy? He know others will not go along with him and his friend is safe.

At this point McCain would throw his mother under the bus to get elected. His willingness to say and do anything and deny any responsibility for having helped put the good people of this country in this situation is disgraceful. I used have a lot of respect for the man - now I wouldn't shake his hand if there was a $100 bill in it. Unfortunately he's not the only one. Most politicians have been driven by corporate agendas for the last 30 years, democrats included. Until we change campaign financing, it'll be very difficult to change Washington.

Sorry ted, you didn't look far enough. 2003 Bush set forth a plan to overhaul the regulatory mechanism covering fannie and freddie and increase the executive control over the board of commissioners of each. It was shot down by none other than Barney Frank(who is the real culprit in this mess) and the dems who used their power to stymie a vote while it was in committee. Of course by that time the investment vehicle was already in play for several years and the people in charge at that time were placed there by Clinton. In fact All the players in this mess were Clinton people. As for the 20% sub-prime estimate for these packages I've heard numbers as high as 40% and the issue was not just those but the real estate speculator lines of credit used to "flip" homes which were much larger than the average mortgage. All of this rapid turnover of investment packages inflated their value so much that there is no realistic way to achieve those values if they were held against inflation and normal market growth for 50 years. AIG was dumb enough to insure these securities and are paying the price. Countless huge funds and investment banks are so heavily invested in these vehicles they have no way to divorce themselves from them. If you dems want to blame someone for this mess, blame your last president.http://query.nytimes.com/gst/fullpage.html?res=9E06E3D6123BF932A2575AC0A9659C8B63&sec=&spon=&pagewanted=print
this link shows you a write up from 2003 to back this up.

Yes, Dan, selling securities falls under the jurisdiction of the SEC, but that's not really the problem here. It is the inappropriate use of risky securities as banking and insurance reserves that has elevated this into a crisis, and everyone from Federal to State regulators let this go on and on. The head of the SEC may be an obvious and satisfying target, but the real problem is the chronic underfunding and underqualification of our regulatory agencies in general.

you guys should pick the lesser of 2 evils..and vote indepednent..

i encourage any one here with an open mind to youtube ron paul.. he should be the next president.. and thats who ill be voting for

This is a very complex problem. I don’t think one person is responsible for everything. Where is the risk management in place? As a consumer, if I cannot afford to buy a half million house and the lender approve my loan, who is doing wrong. I guess both. I should not blame for others because of easy credit. I also need to justify if my income can cover my mortgage and all other expenses. How often you read the news about college students file bankruptcy before they graduate. It is better to go back to the basic of finance management on a personal level. The same rule applies to the business leaders as well.

This is a very complex problem. I don’t think one person is responsible for everything. Where is the risk management in place? As a consumer, if I cannot afford to buy a half million house and the lender approve my loan, who is doing wrong. I guess both. I should not blame for others because of easy credit. I also need to justify if my income can cover my mortgage and all other expenses. How often you read the news about college students file bankruptcy before they graduate. It is better to go back to the basic of finance management on a personal level. The same rule applies to the business leaders as well.

Why would America REWARD complete Democratic Congress failure by solidifying incompetence with a Democratic President?

McCains off base here. After many decades of arm twisting, mostly by Dems (but Repubs whimped out big time), the bar and resonable restrictions for getting mortgage money was low enuf that incapables and losers were now all eligible for loans. The LBJ 'great society' , a galactic flop was the demon seed. This recent regurge is the cancer being removed.

Someone please ask John McCain to explain at what juncture in the economic downturn that the thinks the SEC should have acted. Also, should the SEC have acted immediately to place more scrutiny on derivatives, when that trading activity began to explode from $100 trillion of trading to over $500 trillion? How should the SEC have regulated derivatives? Should all derivatives now be regulated, or just those packaged as AAA Bonds from questionable sources. If John McCain cannot answer this question, maybe Sarah Palin could. McCain has no idea what he is talking about when he attacks the SEC chairman. He is making a scapegoat out of an honorable man to alleviate his own guilt in the matter. I didn't see Senator McCain crusading to regulate Wall Street and big banks.

He has to blame this guy, because he sure doesn't want people to focus on the fact that his economic adviser (and fellow Republican) Gramm is the same one who sponsored the Gramm-Leach-Bailey Act that allowed the collapse of one or two financial institutions to create a domino effect and leave it to the taxpayers to prop everyone up. And you notice that McCain has stopped talking about the "deregulation" he was championing a bit ago now that it's clear that the safeguards we put in back with the Great Depression were there for a very good reason.

If Bush has driven this economy into the ground, I have to believe that a McCain presidency would be "Journey to the Center of the Earth."

This is BS. McCain is throwing someone vulnerable to the wolves to look like he's a non-partisan reformer. It's pretty lame.

uninterested, you're partially right in that Barney Frank does deserve SOME of the blame - but not all of it. If he did, don't you think that McCain would've singled out Barney Frank instead of Cox?

Gramm was the one who wrote the 1999 bill which led to this mess, and Gramm is also the one who on Dec. 2000 slipped in a 262-page amendment into the appropriations bill, which made federal agencies stop regulating financial derivatives (which made it easy to pass along risky mortgage-backed securities to investors).

But yes, Frank and other democrats deserve blame too, but its downright comical to assign all the blame on them...otherwise McCain surely would've done so.

republicans. when desparate we eat our own.

I SAY WE FIRE MCCAIN.......AND LET OBAMA FIRE PAULSEN, AND SEC CHAIRMAN, AND BUSH ECONOMIC WAGS, AND REPUBLICAN BLOWHARDS ABOUT HOW THE ECONOMY IS DOING SO WELL......GIVE ME A DEMOCRAT PRESIDENT.....GIVE ME SOMEONE WHO WILL WORK FOR ALL OF US....GIVE ME SOMEONE WHO KNOWS THE ECONOMY EFFECTS US ALL.....I'M FOR OBAMA AND BIDEN---LET'S PUT THEM TO WORK FOR ALL AMERICA.....NOW!!!!......and since the Alaskans say they like Sarah, please let us give her back to them......NOW!!!!!!!

Palin Email Hacker is Son of Democrat Tennessee State Senator Mike Kernell according to the FBI.
David Kernell, a college student has been positively identified as the perp who hacked Sarah Palin's Yahoo account.
State Rep. Mike Kernell said today that he was aware of Internet rumors about his son being the subject of speculation that he accessed the personal e-mail of vice presidential candidate Sarah Palin.
Asked whether he or his son, a student at the University of Tennessee-Knoxville, had been contacted by authorities investigating the break-in of Palin's account, he responded:
"Me, no."
As far as his 20-year-old son, David, he said: "I can't say. That doesn't mean he has or hasn't (been contacted by investigators."
Kernell, D-Memphis, cited the father-son relationship.
He said he had talked to his son today, but that he talks to his son regularly.
He declined further comment.

AHHH yes the ole if i was in charge i would fire the so in so who fell asleep at the switch and got us into this mess...and IF i had a penny for every time i heard someone say that i could bailout all the troubled brokerage houses banks&S&L's retire the national debt for the next ten yrs prop up the zimbawe falling currency with enough left over for a costco membership& an order of curly fries...BUT SINCE i let that golden opportunity pass me by like so many other golden opportunities like investing in APPLE,NINTENDO THE INTERNET YAHOO or MARRYING THE WOMAN I REALLY LOVED etc etc etc i'm left feeling bitter and clinging to all the wouldda shoulda coulda's of my life....SO who better than i to say SEN...FIRE THY SELF BECAUSE IT WAS YOU GRAMM HIS WIFE, THE KEATING FIVE AND GREENSPAN JUST TO NAME A FEW WHO LAID THE FOUNDATION FOR THE TURMOIL WE NOW FACE SO FOR YOU TO TRY AND PLACE BLAME ON A PERSON WHO IS ONLY WORKING WITHIN THE GUIDELINES{PUT AN UNTETHERED WEASEL IN THE HEN HOUSE AND IT'S GOING TO DO WHAT WEASELS DO BEST} OR LACK THEREOF SET DOWN BY YOU AND YOUR COHORTS..i know there are some who might say GEE brk dck aren't you being a little hard on the sen.AFTER ALL BACK {ethic aside}THEN HE SAW A GOLDEN OPPORTUNITY AND CASHED IN ON IT and he has more than given his woulda shoulda coulda's since that whole keating's affair was exposed to which i say HAVE YOU LOST YOU RABBIT HOPPING MIND..TELL THAT TO ALL THOSE WHO HAVE LOST OR IN THE PROCESS OF LOSING THEIR HOMES,INVESTMENTS TELL THAT TO THOSE WHO ARE OR ABOUT TO BE DOWNSIZED....I HEARD THE SEN'S DAUGHTER SAY NO ONE KNOWS MORE ABOUT WAR THAN HER FAMILY AND HIS CAMPAIGN SAY NO ONE KNOWS MORE ABOUT OIL OR ENERGY THAN THE cuda and he has said he knows nothing about the economy THIS HAS GOT TO BE THE FIRST TIME IN HISTORY THAT TWO WRONGS AND ONE RIGHT EQUALS 100%

I do hope McCain or Obama fires Cox immediately. (Preferably McCain will get the honor.) I am a resident of Newport Beach and Chris Cox was my congressman and a very bad one too I might add, even though I consider myself a staunch Republican.

Chris Cox abused his power as a congressman to get the United States Marine Corps evicted from El Toro. His wife Rebecca Cox was on the base closure commission that voted to close El Toro, even though the Marines objected. The Irvine Company wanted the Marines removed so they could add thousands of homes into the massive noise buffer zone surrounding El Toro International Airport.

The people of Orange County voted TWICE to convert El Toro into an international airport that would not only serve the region but also provide some badly needed relief for LAX. It is Chris Cox who hijacked the process, delayed the transfer from the Navy to Orange County for an airport, and arranged for the land to be sold to Lennar for pennies on the dollar. (Never mind Lennar has lost 2 billion dollars over the past year alone.) They have NO MONEY to build the "Great Park" that was promised to the gullible voters.

To the good people of Los Angeles who wonder why LAX is overwhelmed and the freeways are crammed with South Orange County NIMBYs; it would be Chris Cox who is the number one culprit for El Toro International Airport not being kept open for business. El Toro is a ten billion dollar aviation asset that ALL of the nation's taxpayers financed. They should get a chance to reuse it.

eltoroairport.blogspot.com

I do hope McCain or Obama fires Cox immediately. (Preferably McCain will get the honor.) I am a resident of Newport Beach and Chris Cox was my congressman and a very bad one too I might add, even though I consider myself a staunch Republican.

Chris Cox abused his power as a congressman to get the United States Marine Corps evicted from El Toro. His wife Rebecca Cox was on the base closure commission that voted to close El Toro, even though the Marines objected. The Irvine Company wanted the Marines removed so they could add thousands of homes into the massive noise buffer zone surrounding El Toro International Airport.

The people of Orange County voted TWICE to convert El Toro into an international airport that would not only serve the region but also provide some badly needed relief for LAX. It is Chris Cox who hijacked the process, delayed the transfer from the Navy to Orange County for an airport, and arranged for the land to be sold to Lennar for pennies on the dollar. (Never mind Lennar has lost 2 billion dollars over the past year alone.) They have NO MONEY to build the "Great Park" that was promised to the gullible voters.

To the good people of Los Angeles who wonder why LAX is overwhelmed and the freeways are crammed with South Orange County NIMBYs; it would be Chris Cox who is the number one culprit for El Toro International Airport not being kept open for business. El Toro is a ten billion dollar aviation asset that ALL of the nation's taxpayers financed. They should get a chance to reuse it.

eltoroairport.blogspot.com

Ms. Palin first embraced the "troopergate" investigation, with well-publicized painted lip service to "transparency" and having "nothing to hide."

Now, Ms. Palin and her family refuse to comply with lawful investigative subpoenas. Quite a flip-flop.

This may be another instance of poor decsion making by McCain, or simply caving to pressure from the forced pregancy lobby. It bodes ill for our beloved country if they are elected.

First of all, the great majority of posters don't know the responsibilities of the SEC.

The particular issue is stock market operation, and specifically, issues relating to market trading.

Cox came under a lot of criticism when the trading up-tick rule was dropped. The SEC stated that their research showed that over a period of time (the exact length I cannot recall), that it didn't make any difference.

The reaction was, just because over a short period of time its operation wasn't necessary, under stressful market conditions, it was important. Another part of the rule was that sellers of long (i.e. actual owners of the security) had precedent over short sellers -- those that didn't actually own the security.

This rule was put into effect in the early 1930s after a study of the trading during the 1929 crash.

So, what was expected to happen by those really knowledgeable of market trading, did happen. Those that have lost considerable money in their market investments can thank Cox to a large degree.

What is even worse, to this day, the SEC still has **not** reinstated the rule.

Cox runs the SEC, and as McCain has stated, President Bush should request his resignation. (Actually MaCain's request was even stronger, but something that Bush cannot do, fire the man.)

Still further, look at Cox's, education. His education is essentially the same as Obama's -- so here is a clue as to what kind of president Obama will be. Nice talk, but completely ineffectual as a president.


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A veteran foreign and national correspondent, Andrew Malcolm has served on the L.A. Times Editorial Board and was a Pulitzer finalist in 2004. He is the author of 10 nonfiction books and father of four. Read more.
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