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Dr. Byrne Interview on CNet

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Posted by:   bobo 3/6/2006 12:53 PM

 

An absolutely breathtakingly good interview with Dr. Patrick Byrne today on CNet. If you are ever going to read only one thing ever written about him, this would be the interview to read.

He covers pretty much everything - his Dad, the SEC, the miscreants, why Wall Street hates his guts, what is really going on at OSTK...

Here are some choice quotes:

"I think there is a group of miscreants in the market that have to be flushed out. No financial reporters from the East Coast financial media will report that that's what the fight is about."

"It's kind of funny. The role is reversed. These guys have turned into a bunch of conspiracy nuts. They're saying these SEC investigations and subpoenas were orchestrated by somebody else and that they're innocent and how awful this is. Well, that's exactly what most companies say when they come under a bear raid. They say, "Hey, we've got some short seller who has dug up phony evidence, pasted it together, and they've tried to get some investigations launched."

I saw a clip where Herb Greenberg used the word conspiracy six times in 7 seconds. So, the irony of this situation is not lost. I'm anything but the guy behind the SEC investigation. I don't pull any strings at the SEC. The SEC didn't need me to develop this case, and my sense is that this has to do with far more than Overstock.com. We're the tip of the iceberg."

" There's an entire industry devoted to taking short positions on companies and trying to get reporters to bash them."

"This is moving into the realm of Washington, D.C. I'm not talking about the SEC; I'm talking about how a lot of other people in D.C. are getting their minds around this. And I think that there is, as of today, actually, a great big, U.S. government-grade, hot fudge high colonic getting whipped up for some fellows on Wall Street."

Well, you can't say that we didn't warn them, can you? Great interview, great man.

What else can you say?
Copyright ©2006 Bob O'Brien
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Comments (26)
Re: Dr. Byrne Interview on CNet By J on 3/6/2006 1:30 PM

Forget Chris Byron.

Let's celevrate Greg Sandoval!

This interview was just the rejuvenation I was looking for, and that "as of today" comment really has me excited for where we are headed as a movement.

Fantastic.
Re: Dr. Byrne Interview on CNet By J on 3/6/2006 1:33 PM

Correction:

celebrate, not "celevrate"... I must've celebrated a little too hard!
Re: Dr. Byrne Interview on CNet By Browntrout on 3/6/2006 1:34 PM
"This is moving into the realm of Washington, D.C. I'm not talking about the SEC; I'm talking about how a lot of other people in D.C. are getting their minds around this. And I think that there is, as of today, actually, a great big, U.S. government-grade, hot fudge high colonic getting whipped up for some fellows on Wall Street "
YIPPPPPEEEEEE!!!!!! Here is a site that will be useful to those and their families that get arrested! http://www.prisonexpressions.com/
Re: Dr. Byrne Interview on CNet By Niel Storts on 3/6/2006 1:49 PM
Refreshing to see that there are honest journalists. I was beginning to think that that trade was devoid of any that still understood the correct method of plying the craft. The wall street urinal will not be beating a path to the door of that honest man. Might be a fine idea for some to read the interview so they too can learn how they ought to conduct themselves.
Re: Dr. Byrne Interview on CNet By dave on 3/6/2006 1:59 PM
I like your new word. Kind of a cross between celebrate an salivate.

The dog celevrated over the bone that he found in his dish - what good luck.

I'm celevrating over the progress we are making.
Re: Dr. Byrne Interview on CNet By nopec2001 on 3/6/2006 2:10 PM
Great Dr. Byrne interview!! Keep up the good work all! Maybe the good guys will prevail!!
Re: Dr. Byrne Interview on CNet By rtway1 on 3/6/2006 2:20 PM
I thank Mr. Sandoval for his professional work on this subject. This is the way that journalism was meant to be. He will be read from here on in.
Re: Dr. Byrne Interview on CNet By mhelburn on 3/6/2006 2:49 PM
NEW YORK, Feb 28 (Reuters) - A senior executive from bankrupt U.S. futures and commodities brokerage Refco Inc. said on Tuesday it was standard procedure for the firm's unregulated brokerage unit to borrow against customer assets, and this had been communicated to clients."



http://yahoo.reuters.com/news/articleinvesting.aspx?view=CN&symbol=RFXCQ.PK&storyid=257133%2028-Feb-2006%20RTRS
Re: Dr. Byrne Interview on CNet By mhelburn on 3/6/2006 3:54 PM
I looked up Greg Sandoval and came up with this website

http://www.investingcomplaints.com/index.html

It has a listing of reporters, one of whom is a Pulitzer Prize winner.
Re: Dr. Byrne Interview on CNet By rjcogburn64 on 3/6/2006 4:16 PM
Byrne was on Robtv, squeeze play today and did an outstanding job. Don't know how to get the transcript, tho.....
Re: Dr. Byrne Interview on CNet By mfairview on 3/6/2006 4:22 PM
The video is at robtv.com (at the bottom)
Re: Dr. Byrne Interview on CNet By eager on 3/6/2006 4:45 PM
robtv.com around 24 min mark
Re: Dr. Byrne Interview on CNet By Wonder Boy on 3/6/2006 4:51 PM
mfairview----------

Thank you for that link! The thing that I found the most interesting was that the DTCC had called them to bolster theri position!

Ain't it amazing that when Byrne is given a 'chance' to talk, he comes across quite 'sane', unlike when Kudlow & Gang just outscream him.

I have so little faith in Congress and even less in Cox that I get disgusted with myself for feeling so negative. Still, somewhere, deep inside me, I know that we are right. The 'powers to be'---press, Congress, other politicians, hedge funds, etc.---want to keep their secrets hidden, but when the public finds out that they have been stolen from for all these years, look out.
Re: Dr. Byrne Interview on CNet By dave on 3/6/2006 5:15 PM
If we keep up the pressure AND make sure other investors know (try to post http://www.thesanitycheck.com at least once per day to a blog somewhere), then we will inevitably win.

The NY financial press has become irrelevant.

My goal is to have a celebration party somewhere warm by the fall.
Re: Dr. Byrne Interview on CNet By n-tres-ted on 3/6/2006 5:29 PM
http://www.robtv.com/shows/past_archive.tv

The Pat Byrne interview on robtv is REALLY good, too. He winds up by saying the DTCC is being run by criminals who are lying through their teeth about the nature of the FTED problem, and that he hopes DTCC will sue him for saying that.
Re: Dr. Byrne Interview on CNet By mfairview on 3/6/2006 5:34 PM
It's ashame he has to leave the country to get a fair on the air interview. They were assertive but fair I think. It's funny to think that is so unusual. First CNET then RobTV. Two in one day. Things looking up in that dept?
Re: Dr. Byrne Interview on CNet By Patchie on 3/6/2006 5:46 PM
n-tres-ted,

I responded to Squeeze Play with this comment. The members of the DTCC were on distribution. Funny how numbers can be manipulated

Amanda,

I listened to your Squeeze Play telecast Monday night and was impressed by the overall interview with Dr. Patrick Byrne.

If I may, I would like to reply to the comment from the DTCC regarding Fails to Deliver and the issue of $Quadrillions settled with only $6 billion in FTD’s.

This number is a smoke and mirrors figure and I will explain why. You then must ask yourself why they would mislead you as they have and to continue to deceive the overall investing public.

The quadrillion figures that the DCC touts is an aggregate total figure of trades settled in a one year period. What is not understood is whether this quadrillion figure includes fails that are covered through the stock borrow program and at what magnitude these fails covered through the SBP are within the quadrillion figures presented. The DTC should be presenting data that separates out the total value of trades that settle through the legal seller delivery process and what percentage of overall trades fail for one reason or another. That would be the first valued snapshot of the market settlement system.

Furthermore, the DTCC claimed that they have only $6 Billion in Fails to Deliver compared to a quadrillion in settled trades. That is again a misrepresentation of facts.

That $6 Billion is a figure representative of mark to market daily fails and changes daily. It cannot be equated to the quadrillion as the quadrillion is a summation of all trades executed through the course of a year where the $6 Billion is only an aggregate snapshot of any given trade day.

As an example, Lets say that on Monday the DTCC carries $6 Billion in aggregate FTD’s on the books and on Tuesday $1 Billion of those FTD’s becomes settled but another round of fails is entered into the system with an equal $1 Billion in market value. The aggregate $6 Billion remains on the books on Tuesday but by direct comparison to the quadrillion figures presented, we now have $7 Billion in FTD’s based on a rolling aggregate total. For the DTCC to use apples to apples comparison, they need to identify the aggregate sum total of fails that crossed the DTCC settlement system through the course of the year. I can guarantee you it is far greater than $6 Billion.

In addition to this type of accounting, the DTCC relies on mark-to-market calculation of a FTD. The Settlement system was intended to insure prompt settlement to not have great disparity and liability between trade date and execution date. It was this liability that reduced the trade settlement guidelines from T+5 to T+3 and now is being evaluated for T+1.

In the case of a settlement failure (lets use Overstock as an example), An FTD that took place in August 2005 occurred at $46.00/share value. A 1000 share FTD represented $46,000. A similar 1000 share trade executed that same day and settled also carries a $46,000 value. But because that FTD remains on the books today, the FTD is now being carried at a liability of only $23,000 (1000 shares at $23.00/share). The DTCC booked the high cost of the trade in calculating their quadrillion settled but has allowed the settlement failure to diminish in value mark to market.

It is therefore imperative that the DTCC presents figures in real time dollar values at the time of the trade date when comparing the value of the fails executed annually to that of trades settled annually. Allowing for trade value depreciation in an oversold manipulative market only allows for the problem to be masked. From data obtained through court order, we know that the DTCC carried FTD’s in a company called Eagletech for over a calendar year where the trade origination price was $11.00/share and the trade was ultimately settled at $.50/share. How the DTCC book kept this trade in their comparative analysis would be interesting.

As for whether any of this is a small number or a large number, we live in a technology sector where supercomputers can track nearly everything and where a trade can be settled in nanoseconds if the shares are legitimately available. You would not allow your bank to have a 2, 3, 4% error in their processing and thus neither should the stock markets. Industries strive for 6 sigma quality and the DTCC is far from that achievement.

The funny thing about accounting and numbers is that it is very easy to pull a fast one if you simply stick to your guns. The DTCC has been pulling a fast one by creative accounting that has ultimately misled the investing public. If they were a publicly traded company they would be under investigation by the SEC for fraud in the dissemination of information.

I would hope that the DTCC would have the honesty and courage to reply to you with appropriate figures as they have turned down so many others seeking such accuracies in information. If it is really not a problem they should not be concerned with providing such information.

Dave Patch
Re: Dr. Byrne Interview on CNet By Admiral Ackbar on 3/6/2006 6:00 PM
Great articles. Patrick actually is a very gifted writer. It was those awesome slideshows he narrated that convinced me and everyone i have shown them to of the reality of the stock fraud game and how the game is played. I just have to convince a journalist or two to take a couple of hours to watch those slideshows.
Re: Dr. Byrne Interview on CNet By n-tres-ted on 3/6/2006 6:20 PM
I see a day coming soon when PB will be fairly interviewed, not by CNBC, but by PBS on the News Hour. CNBC's window of opportunity to redeem itself is beginning to close.
Re: Dr. Byrne Interview on CNet By jcline on 3/6/2006 6:22 PM
" would hope that the DTCC would have the honesty and courage to reply to you with appropriate figures " Boy that would be a step in the right direction....but I am not holding my breath for it! Misleading the public by "creative accounting" still should lend itself to investigation....by the DOJ. IMO
Re: Dr. Byrne Interview on CNet By troydian on 3/6/2006 6:22 PM
Here is the dtcc version of the fact...... How do they SLEEP?
Home :: Publications :: Dtcc :: Mar 0 5 :: Naked Short Selling and the Stock Borrow Program
--------------------------------------------------------------------------------

Naked Short Selling and the Stock Borrow Program


In recent months, there has been a fair amount of media coverage of naked short selling, Regulation SHO and even DTCC’s role in that via the Stock Borrow program operated by DTCC subsidiary National Securities Clearing Corporation (NSCC). Because there has been much confusion about these issues, and much misinformation, @dtcc sat down with DTCC First Deputy General Counsel Larry Thompson to discuss these issues.

@dtcc: Let’s start with the question, what is naked short selling and why has it suddenly become an issue?

Thompson: Short selling is a trading strategy where a broker/dealer or investor believes that a stock is overvalued and is likely to decline. It is an integral part of the way our capital market system works. Basically, it involves borrowing stock that you don’t own and selling it on the open market. You then buy it back at a later date, hopefully at a lower price, and as a result, making a profit.

Naked short selling is selling stock you don’t own, but not borrowing it and making no attempt to do so. While naked short selling occurs, the extent to which it occurs is in dispute.

@dtcc: DTCC and some of its subsidiaries have been sued over naked shorting. What has been the result of those cases?

Thompson: We’ve had 12 cases to date filed against DTCC or one of our subsidiaries over the naked shorting issue. Nine of the cases have been dismissed by the judge without a trial, or withdrawn by the plaintiff. The other three are pending, and we have moved to dismiss all those cases as well. While the lawyers in these cases have presented their theory of how they think the system works, the fact is that their theories are not an accurate reflection of how the capital market system actually works.

@dtcc: One of the allegations made in some of the lawsuits is that the Stock Borrow program counterfeits shares, creating many more shares than actually exist. True?

Thompson: Absolutely false. Under the Stock Borrow program, NSCC only borrows shares from a lending member if the member actually has the shares on deposit in its account at the DTC and voluntarily offers them to NSCC. If the member doesn’t have the shares, it can’t lend them.

Once a loan is made, the lent shares are deducted from the lender’s DTC account and credited to the DTC account of the member to whom the shares are delivered. Only one NSCC member can have the shares credited to its DTC account at any one time.

The assertion that the same shares are lent over and over again with each new recipient acquiring ownership of the same shares is either an intentional misrepresentation of the SEC-approved system, or a profoundly ignorant characterization of this component of the process of clearing and settling transactions.

@dtcc: Another allegation is that the Stock Borrow program has become “a reliable source of income” for NSCC? Some articles have said we make almost $1 billion from it.

Thompson: This statement is purposely misleading. One billion dollars represents our total revenue from all our operations of all subsidiaries. The fact is that there are NO separate fees for transactions processed through the Stock Borrow program. There is just the normal fee for delivery of the shares, which is 30 cents per delivery. If you assume we make an average of 22,000 deliveries through Stock Borrow a day, there would be about $6,600 extra a day in revenue over 253 trading days, or about $1.67 million a year in additional revenue, out of $1 billion.

All of our members know that DTCC and all its subsidiaries operate on a “not for profit” basis. What that means is that we aim to price our services so that our revenues cover our expenses.

@dtcc: Just how big is the fail to delivers, and how much of those fails does the Stock Borrow program address?

Thompson: Currently, fails to deliver are running about 24,000 transactions daily, and that includes both new and aged fails, out of an average of 23 million new transactions processed daily by NSCC, or about one-tenth of one percent. In dollar terms, fails to deliver and receive amount to about $6 billion daily, again including both new fails and aged fails, out of just under $400 billion in trades processed daily by NSCC, or about 1.5% of the dollar volume. The Stock Borrow program is able to resolve about $1.1 billion of the “fails to receive,” or about 20% of the total fail obligation.

The Stock Borrow program was created in 1981 with the approval of the SEC to help reduce potential problems caused by fails, by enabling NSCC to make deliveries of shares to brokers who bought them when there is a “fail to deliver” by the delivering broker. However, it doesn’t in any way relieve the broker who fails to deliver from that obligation. Even if a “fail to receive” is handled by Stock Borrow, the “fail to deliver” continues to exist, and is counted as part of the total “fails to deliver.” If the total fails to deliver for that issue exceeds 10,000 shares, it gets reported to the markets and the SEC.

@dtcc: If the volume in the Stock Borrow program is so small, why are these companies suggesting it is a major issue?

Thompson: Frankly, we believe that the allegations are attempting to purposely mislead those who are not familiar with this program. A number of small OTCBB and so-called “pink sheet” companies have contended that this practice is driving down the price of their shares and driving them out of business.

According to their own 10K and 10Q reports financial auditor’s disclosure statements, many of these firms have admitted that “factors raise substantial doubt about the company’s ability to continue as a going concern.” They have had little or no revenue, according to their financial reports, and substantial losses, for periods of seven or eight years. One of these companies has been cited for failing to file financial statements since 2001. Another has been cited by the SEC for press releases that misled investors on expanding business contracts that didn’t exist. They will do anything they can do that takes people’s attention off that kind of record, especially if they can convince a law firm to take the case on a contingency basis, which is what has happened.

@dtcc: Who are the law firms bringing these suits?

Thompson: The main law firms engaged in these lawsuits, and they have been behind virtually all of them, were principally involved with the tobacco class action lawsuit. They like to bring suits in multiple jurisdictions in an attempt to find any jurisdiction where they might be successful in winning large judgments.

@dtcc: What causes a fail to deliver in a trade? Is it all naked short selling?

Thompson: There can be any number of reasons for a “fail to deliver,” many of them the result of investor actions. An investor can get a physical certificate to his broker too late for settlement. An investor might not have signed the certificate, or signed in the wrong place. There may have been human error, in that the wrong stock (or CUSIP) was sold, so the delivery can’t be made. Last year, 1.7 million physical certificates were lost, and sometimes that isn’t discovered until after an investor puts in an order to sell the security. There are literally dozens of reasons for a “fail to deliver,” and most of them are legal. Reg SHO also allows market makers to legally “naked short” shares in the course of their market making responsibilities, and those obviously result in fails. We can’t do anything about them but what we are doing: that is, report all fails of more than 10,000 shares in any issue to the marketplaces and the SEC for their action.

@dtcc: What happens then?

Thompson: The markets check to see if the amount of fails to deliver is more than 1/2 of 1% of the total outstanding shares in that security. If it is, then it goes on a “Threshold List.” If it is then on the Threshold List for 13 consecutive settlement days, restrictions on short selling then apply. The “close-out” requirement forces a participant of a registered clearing agency to close out any “fail to deliver” position in a threshold security that has remained for 13 consecutive settlement days by purchasing securities of like kind and quantity. If the participant does not take action to close out the open fail to deliver position, the participant is prohibited from making further short sales in that security without first borrowing or arranging to borrow the security. Even market makers are not exempt from this requirement.

@dtcc: So Reg SHO doesn’t force them to close out the position, but if they don’t, they are prohibited from making any additional short sales without borrowing the shares first?

Thompson: That’s right.

@dtcc: Does DTCC have a regulatory role in naked short selling? What authority does it have to force companies to settle a fail?

Thompson: Naked short selling, or short selling, is a trading activity. We don’t have any power or legal authority to regulate or stop short selling, naked or otherwise. We also have no power to force member firms to close out or resolve fails to deliver. That power is reserved for the SEC and the markets, be it the NYSE, Nasdaq, Amex, or any of the other markets. The fact is, we don’t even see whether a sale is short or not. That’s something only the markets see. NSCC just gets “buys” and “sells,” and it’s our job to try and clear and settle those trades.

@dtcc: Why won’t you reveal the number of fails to deliver in each position to the issuer of the security?

Thompson: There are a couple of reasons. First, we provide that information to regulators and the SROs so they can investigate fails and determine whether there are violations of law going on. Releasing that information might jeopardize those investigations, and we feel they are the appropriate organizations to get that information since they can act on it. Second, NSCC rules prohibit release of trading data, or any reports based on the trading data, to anyone other than participant firms, regulators, or self-regulatory bodies such as the NYSE or Nasdaq. We do that for the obvious reason that the trading data we receive could be used to manipulate the market, as well as reveal trading patterns of individual firms.

@dtcc: How does DTCC respond to claims that shares from cash accounts and/or retirement accounts and/or institutional accounts are being put into the lending pool of the Stock Borrow program?

Thompson: It is our broker and bank members who control their DTC accounts. They can and do segregate shares that they are not permitted to lend out. Neither NSCC nor DTC monitor or regulate that activity. It is done by the SROs and the SEC. However, there is no requirement that brokers or banks participate in the Stock Borrow program, and neither DTC nor NSCC can take shares from an account unless those shares are voluntarily offered by the broker or bank member.

@dtcc: Do you think there is illegal naked shorting going on?

Thompson: Certainly there have been cases in the past where it has, and those cases have been prosecuted by the SEC and other appropriate enforcement agencies. I suppose there will be cases where someone else will try to break the law in the future. But I also don’t believe that there is the huge, systemic, illegal naked shorting that some have charged is going on. To say that there are trillions of dollars involved in this is ridiculous. The fact is that fails, as a percentage of total trading, hasn’t changed in the last 10 years. @
Re: Dr. Byrne Interview on CNet By jcline on 3/6/2006 6:28 PM
"The fact is that fails, as a percentage of total trading, hasn’t changed in the last 10 years".............. Confessing to knowledge of stock Counterfeiting for 10 years........ amazing statment by a DTCC atty , eh?
Re: Dr. Byrne Interview on CNet By troydian on 3/6/2006 6:30 PM
SEC: Gone Fishin'

A BIG ONE IS GETTING AWAY WHILE IT CASTS AT REPORTERS

By Chris Byron
New York Post
March 6, 2006

It’s good to see that the U.S. Securities and Exchange Commission has come to its senses and that - at least for the time being - it won't be enforcing the media subpoenas that have gotten the press so riled up.

But before anyone breaks out the pom-poms for SEC Chairman Christopher Cox, let's remember that these wrong-headed subpoenas were 100 percent the responsibility of Cox's own agency in the first place - and until the SEC develops better, more focused leadership, problems like those caused by these subpoenas are going to keep occurring.

What's more, while the SEC has been chasing after wrongdoing by hedge funds that may not even have occurred, real examples of hedge-fund misconduct have gone ignored.

Consider the Lancer hedge fund case, which has been rotting like a dead fish in the agency's own files for years.

Two weeks ago, a federal judge in Miami unsealed more than 40 pages of internal e-mail, memos and similar materials produced in the Lancer hedge fund fraud case, which developed out of a series of articles that ran in The Post almost four years ago.

This latest round of Lancer documents had been produced, under a court-ordered subpoena, by the fraud-drenched fund group's administrative and record-keeping firm, Citco Fund Services. The Citco brass had fought tooth and nail to keep the documents sealed, and it's not hard to see why.

Even a casual reading of the unsealed case file shows that Citco's profit-crazed officials were fully aware, year after year, of the flagrantly false and fraudulent accounting that turned Lancer into a $1.2 billion house of cards.

Worse, the documents show that almost to the moment of Lancer's collapse in the summer of 2003, Citco bigwigs spent much of their time fretting over how they could extricate Citco - and themselves - from the Lancer fiasco before being dragged down in the collapse that was certain to come.

There is e-mail between Citco officials warning that the fund was deeply engaged in price-rigging schemes involving an array of worthless penny stocks. Other documents, one dating from as far back as autumn 1996, warn that rampant accounting skullduggery was affecting the funds' net asset values.

One remarkable e-mail message from May 2002 shows Citco officials scheming to get Lancer's outside auditors at PricewaterhouseCoopers to "sign off" on the fraud so that Citco wouldn't wind up being accused of orchestrating a coverup on its own.

THE memo warns, "This would be very bad news for us."

Elsewhere in the memo, the author - Citco official John Verhoorfen - suggested alerting U.S. law enforcement, offering an astonishing rationale for doing so: "At least that way it looks like we uncovered the problems."

All this and more has sat unpursued in the SEC case file for years while the agency has waged a faltering struggle to develop a case not against Citco and Lancer's equally vulnerable and complicit accounting firms, outside auditors and bank custodians, but merely against the fund group's founder and managing director, Michael Lauer.

In any event, the most the SEC can hope for is a fine and an injunction from further fraud. By contrast, a case against Citco would not only have been far easier to prove, but would have yielded a much larger fine than anything likely to be slapped on Lauer. +

And most important of all, pursuing a case against Citco would likely have led to a high-visibility criminal referral to the U.S. Department of Justice years ago, sending an unmistakable message to the entire hedge-fund industry that those who break the law will go to prison.

But the SEC has done nothing of the sort, choosing instead to spend its time frittering away its resources on conspiracy snipe hunts like the one inolving the subpoenaed e-mail of three journalists.

This is all happening because, as I have argued many times in this space, the SEC is a poorly led, bureaucratic anachronism from the New Deal that lacks a mission relevant to the times and the enforcement tools to get the job done.

As such, it has been functioning for the last half decade in a climate marked by revolving-door leadership at the top, staff defections in the middle ranks and bewilderment at every level regarding the types of activities the agency's enforcement division ought to be looking for when it comes to improper and illegal behavior by hedge funds.

Against that backdrop, the SEC has developed into one of the most troubled and demoralized - yet intensely politicized - agencies in the entire federal government, with the once-coveted job of SEC chairman becoming one of the most shunned hot seats in Washington.

For the first six months of his first term, President Bush couldn't even find a replacement for the departing Arthur Levitt, helping bolster the impression that this was a job no sensible person wanted.

The man Bush finally signed up, white-collar criminal defense lawyer Harvey Pitt, lasted 18 months before pushing the self-destruct button. After Pitt came William Donaldson, a Wall Street old-timer who was hounded out of office after two years.

Donaldson's tour ended when he impaled himself on a pledge to bring the unregulated world of hedge funds to heel by forcing them to file regular financial statements with the SEC, the same way mutual funds do.

After Donaldson came the current occupant of the office, Cox, who arrived on the scene last August.

Anxious to deflect speculation that he planned to let Donaldson's newly enacted hedge-fund reporting rules become dead-letter law through lax enforcement, Cox said he intended no such thing and expected the rules to be enforced exactly as written.

Now, of course, he's got exactly the opposite problem, courtesy of subordinates who apparently took his comments as a thumbs up for a hedge-fund jihad, and thereupon launched themselves on a subpoena-backed fishing expedition through the e-mails of three journalists.

This isn't how any agency of government should be run, but it's been standard operating procedure at the SEC for years. And don't count on it changing anytime soon - especially now that Cox has managed to dial down the volume on the whole affair.

Besides, out here in the short attention span theater of American life, a person can only stand so much of anything before reaching for the zapper. A night at the Oscars? Some quality time with the gang at "Law & Order SVU"? Maybe some of the overnight action from Baghdad. The mind reels, it's all a blur . . . Zzzzzzzz
Re: Dr. Byrne Interview on CNet By troydian on 3/6/2006 6:38 PM
http://www.buyins.net/tools/short_list.php?dys=1 SO NAKED SHORTING IS A SMALL PROBLEM?
Re: Dr. Byrne Interview on CNet By troydian on 3/6/2006 6:43 PM
http://www.nakedshortlist.com/selectbymarket.html how many companys have fallen vicim to the wall street THUGS?
Re: Dr. Byrne Interview on CNet By robelita on 3/6/2006 6:58 PM
Outstanding PB interviews! I think it safe to say that we've got this machine on a roll and have shifted out of first and into second gear. Any one who's driven a "stick" knows there's more torgue in the lower gears but the real raw power is experienced during cruise when speed and mass enable a vehicle to careen on down the highway efficiently like a missile on a trajectory where stopping it will require an inordinate amount of counter-force. Our "battle" reminds me of the children's story "The Little Engine That Could". We BELIEVE therefore we DO!

Keep believing and keep doing!

BTW bobo-what were the poll results? My funny bone feels neglected.

E I E I OWE-smirk

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