The incoming further deregulation of Wall Street

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iceaura

Valued Senior Member
https://www.nytimes.com/2017/09/24/...tures-trading-commission.html?ref=todayspaper
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After years as a sleepy federal backwater, the Commodity Futures Trading Commission became one of Wall Street’s most aggressive watchdogs during the Barack Obama administration.

Now the agency — which is responsible for policing a broad swath of markets and financial machinery, from trading in commodities to digital currencies to the complex derivatives that helped torpedo the financial system in 2008 — is shifting its law enforcement strategy: It will increasingly look to banks and other financial institutions to come clean on their own about misconduct and problems in the market.
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Aitan Goelman, who was the commission’s enforcement director until February, said the agency’s small budget meant it had no choice but to rely in part on the institutions it regulated to help flag misconduct and other problems.

“The C.F.T.C. is so chronically and acutely under-resourced that it’s even more necessary to encourage cooperation,” said Mr. Goelman,
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This is exactly what led to the implosion in 2008 (and the smaller one in the late 1980s) http://www.newsmax.com/finance/StreetTalk/krugman-reagan-crisis-caused/2009/12/17/id/343594/
 
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timojin said:
The inside trader will cheat always, because buy and sell depend on early information.
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Prevention and punishment of insider trading, among the many ways to lie and cheat, is of course a function of oversight.

Working in our favor: financial criminals are often rational and calculating - unlike many street and violent criminals, financial criminals are reliably deterred by a credible threat of jail time and loss of wealth. So law enforcement can be very effective in financial crime prevention - avoiding the injury itself, the highest goal of law enforcement.

We see this in the orgies of financial crime that burgeon in the wake of deregulation and cutbacks of oversight.
 
iceaura said:
Prevention and punishment of insider trading, among the many ways to lie and cheat, is of course a function of oversight.

Working in our favor: financial criminals are often rational and calculating - unlike many street and violent criminals, financial criminals are reliably deterred by a credible threat of jail time and loss of wealth. So law enforcement can be very effective in financial crime prevention - avoiding the injury itself, the highest goal of law enforcement.

We see this in the orgies of financial crime that burgeon in the wake of deregulation and cutbacks of oversight.
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How do you stop an relative to a company accountant from making a significant trade in his favor ?
 
timojin said:
How do you stop an relative to a company accountant from making a significant trade in his favor ?
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Isn't there some form of law and order that can be enforced? The principle seems to apply more to civil crimes rather than financial ones.
 
spidergoat said:
Isn't there some form of law and order that can be enforced?
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Because financial crimes are so often calculated, planned, "rational" actions committed by people in control of their behavior, enforcement is quite efficient - it only takes putting a couple of famous guys in jail to get massive reductions in financial crimes.

Financial laws and regulations actually prevent crime, prevent then injury, with even minimal enforcement. Big bang for the buck.

And big cost if the buck is not tendered.

We see that fact in the major increases in financial crime that follow the removal or non-enforcement of such regulations, and characterize financial systems operating without them.

And that is the situation we are in now.
 
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