Article: Former SEC chair on the market risks even meme stock traders can’t afford to ignore

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Former SEC chair on the market risks even meme stock traders can’t afford to ignore

Eric Rosenbaum, 20 June 2021

The Wall Street establishment and the Reddit, Robinhood-fueled meme stock traders don’t see eye to eye, on just about anything. In fact, rolling eyes at the stock market’s traditional ways is inherent in trades like GameStop and AMC Entertainment.

Warnings from the market greats, like Warren Buffett, may as well be a badge of honor among the new traders. But one thing Buffett hasn’t noted in his criticisms of the “casino” atmosphere of this bull market and companies like Robinhood, which he has thoroughly beat on, is that when he was a young investor himself he had a fondness for “cigar butt” stocks — the dregs of the market, companies with a few puffs left in them — before he graduated to a more refined kind of investing that made him a billionaire. And that Buffett footnote raises an important point about the market’s newest investors. Continue reading “Article: Former SEC chair on the market risks even meme stock traders can’t afford to ignore”

Article: Financial Finger-Pointing Turns to Regulators

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Financial Finger-Pointing Turns to Regulators

Louise Story, Gretchen Morgenson

New York Times, 22 November 2011

In the whodunit of the financial crisis, Wall Street executives have pointed the blame at all kinds of parties — consumers who lied on their mortgage applications, investors who demanded access to risky mortgage bonds, and policy makers who kept interest rates low and failed to predict a housing market collapse.

But a new defense has been mounted by a bank executive: my regulator told me to do it.

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Article: Some lawmakers also shorted stocks, congressional records show

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Some lawmakers also shorted stocks, congressional records show

Robert O’Harrow Jr., Dan Keating

The Washington Post, 5 May 2010

As Congress criticized Wall Street for the proliferation of risky derivatives investments and short-selling practices in recent years, some lawmakers privately made highly speculative investments in derivatives funds that sometimes aimed to profit from a decline in the overall performance of the stock market or Treasury bonds, congressional financial disclosure forms show.

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