John McCain has called for the firing of Christopher Cox, chairman of the Securities Exchange Commission (SEC). This is quite an aggressive move by McCain. He cites poor wall street oversight by the SEC. In doing so, McCain states that Cox has betrayed the public trust.There is no question that the economy and stock market have been hit hard recently. Speculator have been selling stocks short. In other words, they have been betting that stock prices will go down. Not only that, some have been doing naked short sales. Investors often blame these short sellers when stock prices fall. Whether or not they are the direct cause is a point of debate.
We should return to some facts of the matter. The SEC did eliminate something called the uptick rule for short selling. Essentially you could not sell a stock short unless the price was increasing. Another fact is that even good companies are suffering due to the recent events in the stock market.
Now let’s discuss the fate of chairman Cox. The chairman of the SEC is appointed by the president of the United States. Bush has come out and said Cox has his full support. Cox also rebutted McCain’s call with a 10 point list of positive actions the SEC is taking to deal with the stock market.
So why would McCain make such an aggressive move against Cox? He previously had stated that the fundamentals of the economy were strong. Big mistake. His campaign is also losing some steam as the news of Sarah Palin wears off. I would hope that McCain would work on some real action to help the economy instead of some cheap methods like declaring the SEC chairman should be fired.
