Sunday, July 13, 2008

SEC: To probe "negative" rumours

WASHINGTON -- The Securities and Exchange Commission said Sunday it is immediately opening a probe to prevent the spread of false information used to manipulate securities prices.

SEC Chairman Christopher Cox said the investigation is aimed at "ensuring that investors continue to get reliable, accurate information about public companies in the marketplace."

The probe comes amid a new bout of turmoil that has gripped investors. Questions have been swirling about the financial health of mortgage giants Fannie Mae and Freddie Mac as well as Lehman Brothers Holdings Inc.

The Fed's committing more capital to the GSE's, and the SEC is putting down the clamp on rumor mongering. Which means the system was so close to falling apart at the seams that even Government officials could see the writing on the wall!

So they voted to raise the national debt limit, let Fannie and Freddie at the discount wondow, give them a larger line of credit and let the Fed's buy $15 billion of stock!

According to the NY Times:

Announcement of the plan on Sunday evening was intended to send a sharp signal to both stock markets and debt markets that the government was standing behind the beleaguered companies.

Last time that I remember that any writing was on the wall, the words were MENE MENE, TEKEL UPHARSIN.

Something about the plan was "weighed in the balances and found wanting."

Now we see the hand of the government, hoping they can stop the result.

Don't let history be your guide on this one!

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