Ron Paul Weighs In On The Financial Catastrophe <<-- Click to listen to NPR interview
The conversation about the financial crisis, and the details about the proposed $700 billion bailout continues to stir strong opinions. Republican Congressman and former presidential candidate Ron Paul opposes the bailout plan.
Chris Cox versus Alan Greenspan on derivatives
Listening to Chris Cox, the chairman of the Securities and Exchange Commission, giving evidence to Congress a few minutes ago, I was particularly struck by his assault on the lack of regulation of the over-the-counter derivatives market.
Mr Cox described the unregulated $58,000bn credit default swaps market as “ripe for fraud and manipulation”, saying that it was a forum for the shorting of corporate debt without the oversight imposed on cash markets.
It was, of course, Congress that chose in 2000 not to extend regulation to OTC derivatives markets, as I noted in my column on Saturday. One of the most influential proponents of not regulating OTC derivatives was Alan Greenspan, then chairman of the Federal Reserve.
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