EVER HEARD OF THE STOCK EXCHANGE SPECIALIST?
Are you under the illusion that the New York Stock exchange, whose antics we've all been watching so closely the past couple of weeks, is a free and open auction market? Then, according to this article, think again, and the article speaks for itself, so I will try to limit my commentary due to its length:
This article, though based on now outdated data, nonetheless points out the manipulated nature of the NYSE. What is far more important, however, in my opinion, is the interlocked nature of the NYSE, the Federal Reserve, the Securities and Exchange Commission, and the revolving door between all of these.
Note that the victim here is the middle class investor, i.e., the small investor with a little extra cash to invest, for depending on the specialist and his marching orders, that investor can either be enriched, or robbed.
I mention all of this because, as our country now begins a political debate over the economy, the role of the Federal Reserve, the national debt, it is important to realize that another component of our economy needs to be brought into the public debate: Do we really want a small cadre of specialists making such decisions for the country? Does the NYSE need reform, or is the current arrangement satisfactory? Do we need another government bureaucracy when the current one - the SEC - already is so closely connected to the government? Does the revolving door between private business and government agencies really serve the best interests of the people? If not, what can we do to reform the system?
Obviously, not everything with the current system is bad, but there is much broken in our country, as everyone knows, and while our attention is focused on the Fed and its abuses, we need also to remember that there are other institutions that need scrutiny.
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