SEC Chairman Christopher Cox may go down in history as the worst person to ever run his agency. He has been flat-footed and tardy on almost every critical action that the SEC could have taken to effect or correct events which lead to the financial system’s meltdown. In particular, he did nothing to encourage the examination and regulation of mortgage-backed securities and the tremendous levels of leverage taken on by the largest banks and brokerages.
To prove that he can still be slow to ask for additional steps to help monitor the markets, Cox has called for more transparency and regulation of the huge credit default swaps market.
In an opinion piece in The New York Times, Cox writes:
"…despite its enormous size, the credit-default swaps market has operated in the shadows. There is no public disclosure nor any legal requirement for these contracts to be reported to the Securities and Exchange Commission or any other agency." It is odd that Cox has not asked for that until now.
"Because these instruments have been bought and sold widely and in many cases anonymously, they have trapped the large financial institutions in a web of transactions." That is something that any intelligent regulator, banker, or economics professor has known for a long time.
"…the Securities and Exchange Commission should be given explicit authority to issue rules against fraudulent, deceptive or manipulative acts and practices in credit-default swaps." Why didn’t Cox insist on that years ago?
Cox has gone a long way to prove what a tool and buffoon he is. Perhaps Congress can look into how such a boob got the job of running the SEC.
Douglas A. McIntyre