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Today Richard Shelby of Alabama, the ranking Republican on the Senate Banking Committee, ripped Chris Dodd's financial regualation overhaul proposal. Shelby warned that "This committee has not done the necessary work to even begin discussing changes of this magnitude," and, according to the Wall Street Journal, recommended a thorugh investigation along the lines of the Great Depression's Pecora Investigation.

In 1933, Ferdinand Pecora became the chief counsel for the Senate Banking Committee's investigations into the stock market crash of 1929. He spearheaded an exhaustive, multi-year search into the crash's causes that helped shape many New Deal regulations and provided most of the data for later histories of the Depression. The New York Times published a new look at the Pecora Investigation in January, and it's worth a reread.

(An aside: if you click through to the Times article, take a look at their picture of Pecora... one wonders if the Times meant to display that particular image.)

View all comments (2) | Leave a comment

JP| 11.19.09 @ 3:05PM

It's been over a year since the Sep 2008 Wall St meltdown. What is needed is a broad investigation that should go back not the few months that led up to the crash, but a full decade. We need to really see if the repearl of the Glass/Stengle Act in 1998 was a prime contributor to the financial meltdown. What is more, is how much did Congressional actions going back to the early 90s affect CEO decision concerning risk, merit pay and bonuses. How much did the Community Reinvestment Act lead to the 2003-2007 market bubble? And much did Freddie Mac and Fannie Mae contribute? Finally, how much of the meltdown was caused by Alan Greenspan's easy money policies? Remember, he was involved in 2 major financial bubbles/busts (the notorious Dot Com bubble (1996-2000) and the Real Estate Bubble (2003-2007).

There has been so many changes to our financial systems since 1988, that it could be another decade before we really get a handle on things. Money began to easily traverse internation borders after 1992, that by the time the last bubble hit in 2003, it was very difficult to follow how much risk was spread. Remember it was French and Italian banks that first sounded the warnings in 2007. And it was Iceland and Ireland that saw thier entire financial systems meltdown last year.

What can we really learn?

potty training| 2.24.10 @ 1:03AM

nice post woot!

Potty Training Boys | How To Potty Train A Toddler

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More Blog Posts by Joseph Lawler

http://spectator.org/blog/2009/11/19/shelby-wants-depression-style

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