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- iHaveNet.com: Economy
by Paul Greenberg
Maybe only someone woefully ignorant of high finance -- like me -- would still be trying to understand the basis, if any, of the case filed against
Having slept through the stock market's great boom, the
No doubt many questions, relevant and ir-, will be raised at trial. That is, if this lawsuit/vendetta against
Among the many questions the
-- If
No wonder it was looking for ways to balance its portfolio. Among the trove of e-mails released in this dispute, by both sides, there are some from execs at
-- When
-- The
-- If fraud was committed, where are the criminal charges? This is only a civil case. Isn't fraud a crime, not just a tort? There are investigations aplenty but no indictments, verdicts but no trials.
-- Is it now fraud to sell a security that could go down in value -- whether stock or bond or, in this case, a "synthetic collateralized debt obligation"? If so, the country's prosecutors are going to stay awfully busy.
-- Is this whole thing less about economics than politics? Is what we have here what used to be called, in the late and unlamented Soviet Union, an "economic crime"?
-- If I decide to switch from blue chips to government bonds in my little 401(k) account because I think the market's going down and I want to run for cover, am I committing fraud? After all, for every stock sold there was a buyer. Did I defraud him?
-- For that matter, every time I go to the grocery store and decide not to buy tomatoes -- or kumquats or kiwis -- because they cost too much now but will surely get cheaper later in the season, am I being one of those evil speculators?
-- Is the real offense here not fraud but the idea of speculation itself? It's an idea, and daily practice, on which so much of any economy depends. At least if it's gone beyond the barter stage. Without speculators to buy things like commodity futures, and no doubt hedge their bets, American agriculture would be set back a century or two. And that's only one sector of the economy that depends on speculators to moderate supply and demand.
Maybe this case should have been styled
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Just a Few Questions for the SEC