BrokeAndBroker.com: Regulatory Reform

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Apr 2, 2008 8:03 am
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An irreverent Wall Street Blog
by Bill Singer
Blog Home | Past Entries
A Little Birdie Taught Me (laced with profanity)
Written: April 2, 2008


WARNING: This blog contains a profanity. It's only one curse word, and I tried to avoid using it. Unfortunately, if I didn't use the nasty word, the story I wanted to tell wouldn't make as much sense. So, if you are a sensitive type, please don't read further.

Guess what. Lately, I've been getting lots of calls from the press and readers asking my take on the disaster that has befallen our capital markets, and, more recently, on the Treasury Department's Blueprint for regulatory reform. Having spent more than a quarter of a century on Wall Street, I sort of know what's going on. More importantly, I'm a well-known critic of our markets' regulation and its regulators.

In a nutshell, I doubt that much, if any, of the Blueprint will see the light of day. First, politicians will submit the plans to endless hearings and committees and subcommittees and conferences. Then, there will be panels, blue-ribbon panels, presidential-appointed panels, study groups, and advisory groups. Then, there will be outrage from consumer groups and their contingency-fee lawyers. On the heels of that upset, will be the carefully scripted dyspepsia of the industry replete with well-coiffed media consultants and high-priced lawyers (many of whom were former government regulators now turned mercenaries).

Meanwhile, as always, the markets will muddle through and find a way. And by the time the overwrought hodgepodge of impractical reforms are passed into law, things will have moved on and no one will much care. Sorry for the cynicism. Been around for too long. Seen too much. Know too many of the players.

In any event, I could fill this particular blog up with facts and specifics, but why should I be any different from all the other opinionated pundits? Moreover, this is my blog, I own it, I write it -- so, I pretty much can do whatever the hell I want. You don't like that? Tough--go start your own blog!

Anyway, here's a story that best explains my reaction to the current mess in the marketplace, to the Treasury Department's Blueprint, and to all the errant rumblings from Congress and other assorted miscreants and malcontents:

A little birdie was told to fly south for the winter. Figuring it knew better than everyone else, the birdie chose to go it alone. It had done a risk analysis. The numbers looked good for a moderate fall and winter. No need to play it safe. For a while, our maverick looked pretty smart. The temperature stayed warm. Unfortunately, one day, winter came with a vengeance. The ground froze and was covered with snow. The little fella was starving and freezing. Alas, the birdie should have listened to those older and wiser. Just before he passed out from lack of food and hypothermia, a horse passed by and sh*t on the bird. A final insult added to injury--but then a miracle happened. The fresh, warm turd warmed up the little bird. Then, he noticed that were kernels of corn all around him and started to eat. Heated and fed by the pile of sh*t that now surrounded him, the birdie started to sing happily. He had survived! Nearby, a fox heard the chirping and licked the sh*t off the bird and promptly devoured him.

What does that story teach us about the present mess in our capital markets? Oh, I think it teaches us a number of things:

1. When you're in trouble, not everyone who sh*ts on you is trying to hurt you;
2. When you're in sh*t, sometimes it's best just to keep your mouth shut; and
3. Not everyone who gets you out of sh*t is your friend.

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