The Maestro Falls; SEC-CFTC Merger Support Rises

It was a busy day for business on television yesterday.

Viewers watched members of the House Oversight Committee grill former Fed Chairman Alan Greenspan. This morning’s newspapers focus on the Maestro’s admission of a mistake: he owned up to a flaw in his “hands-off regulatory philosophy.”

Fair enough. Now, let’s learn and apply the right lessons from our current situation.

More important (not to mention less political and less sensational) news for Business Finance readers also cropped up at the hearings: SEC Chairman Christopher Cox said he supported combining the SEC with the Commodities Future Trading Commission (CFTC), as former SEC Chair Arthur Levitt and others have argued is necessary.

The regulatory response to the decisions, behaviors, and events that sparked our crisis is more important than the public blame game. That may also be necessary, a sort of bloodletting, but it will not restore confidence among global investors that our banks’ balance sheets and our equity markets can be trusted again.

Later in the evening, PBS views could catch Curved World author David Smick on Charlie Rose’s television program. Smick reiterated much of what he told Business Finance in this interview. And Smick’s concerns (e.g., that we replay not The Great Depression, but Japan’s lengthy economic stagnation of the 1990s) and points (which center on finding the right actions necessary to attract the trillions of dollars sitting on the sidelines right now) represent a more constructive discussion at this point.