In light of recent SEC events I find it necessary to update you Apes on more stuff I’ve been learning from Dr. Trimbath.
FULL CREDIT: I have ordered most of the books off of Dr. Trimbath’s reading list and I am currently reading them. I am blown away by the depth of knowledge and the issues raised in her books. The current book I am reading is “Lessons Not Learned – 10 Steps to Stable Financial Markets.” All I can say is that everything I once believed was true about our financial system has been shattered and its been made absolutely clear that retail is on their own – do not expect the government to step in to protect us. All of the information below is from “Lessons Not Learned.”
I posted on Monday a fact that blew my mind and many of yours – in the 16 months leading up to the 2008 Financial Crisis the SEC had received nearly 5,000 complaints regarding naked short selling – only 123 were forwarded to enforcement – 0 action was taken by the SEC.
However, on July 15, 2008 the SEC issued an emergency order to prevent naked shorting of equity shares of 19 financial institutions listed below:
• Lehman Brothers
• Credit Susie Group
• Deutsche Bank Group AG
• Goldman Sachs
• BOA
• Citigroup
• Allianz SE
• J.P. Morgan
• Merrill Lynch
• Morgan Stanley
• Freddie Mac
• Fannie Mae
• UBS
• Barclays
• HSBC
• Mizuho FG
• Daiwa
• Royal Bank ADS
• BNP Paribas
The Order was to end August 12, 2008 – but was extended through October 1, 2008 AND included an additional 799 financial companies. The SEC’s order did not work – that is the entities that were naked short selling these banks continued to do so even after the SEC entered their emergency orders because they knew the SEC would not do anything and they were RIGHT. In fact, BOA was on the list but data showed that after the SEC’s order was entered, the number of failure to delivers of BOA increased – BOA ended up being bailed out.
My opinion:
This example alone demonstrates the SEC is absolutely and utterly worthless. Not only does the SEC fail to take any action on the more than 5000 naked short selling complaints they received; the SEC fails to enforce or take any action the entities that violated their direct order prohibiting them from naked short selling banks; and the tax payers end up bailing out BOA because the SEC – another tax payer expense which is an utter failure.
Fast forward to today – HOLEEEE – that video the SEC produced about meme trading. In light of the undisputed fact that 95% of trading occurs in dark pools where there is zero transparency, zero rules, zero accountability, and zero ability to enforce any rules – I cannot fathom the idea the SEC would expend resources on that video.
With just these two examples I can confidently say the SEC needs to be dismantled and an entirely new independent monitoring and enforcement entity needs to be erected by the people with full transparency.