NO QUARTER FOR CORRUPTION (Focussing on The Fed./FRBS)

[Telephonics]

http://www.faulkingtruth.com/Articles/Commentary/1063.html


Our SEC Officials isn’t Learning
By Mark Faulk
July 9, 2006


At the SEC, apparently one plus one doesn't always equal two. And with the hedge funds, the only thing that really matters is that the regulations that apply to them add up to zero.


Yesterday, in an article entitled “Double Trouble Valuing The Hedge-Fund Industry,” the Wall Street Journal reported that hedge funds are up in arms about the total hedge fund industry assets as reported by the SEC, asking the question “How did the size of the hedge-fund industry double overnight?” and saying that:


“Until a few weeks ago, the industry had about $1 trillion in assets world-wide, according to a consensus of estimates by academics and consultants. Then, on June 23, the media began reporting that hedge funds had more than $2 trillion.


The confusion began when a federal appeals court tossed out a rule requiring hedge funds to register with the Securities and Exchange Commission. Swamped with queries, the SEC tallied the assets reported by hedge-fund managers who had registered. The figure – a whopping $2.4 trillion -- was reported by The Wall Street Journal, the New York Times, National Public Radio and other news outlets.”


They also pointed out that in Congressional testimony just a few weeks ago, the SEC itself had pegged the total industry assets at $1.2 trillion, or half of the total they claimed had registered with the SEC just a few weeks later. And don’t forget that that figure doesn’t include hedge funds that failed to register, or who escaped detection by crawling through one of the numerous loopholes conveniently written into the SEC hedge fund regulations.


That’s what the Wall Street Journal reported. Here’s what they didn’t ask.


First of all, who’s lying, or can’t perform basic math, or both? If the estimates are closer to the numbers reported by the Hedge Fund Research group, then how did the SEC screw up so badly? These are the same people who are charged with making sure that public corporations don’t fudge on their numbers, and that all financial information given to investors is accurate. If they're wrong about their estimates on hedge fund assets…and not just wrong, but WRONG…then can we trust anything they tell us? When they release figures for stock that isn't delivered to the customers who paid for it, how do we know that those numbers are accurate? Could there be twice as many fails as the SEC reports? Or even more? Can we trust them to release accurate figures on anything, can we even trust them on any information that they release to the public?




Read the rest of this commentary, plus an update on even more noble qualities that the SEC doesn’t believe in, at:
http://www.faulkingtruth.com/Articles/Commentary/1063.html


This article is also posted on Mark Faulk's blog at The Sanity Check, along with an excellent comment forum, at:
http://www.thesanitycheck.com/Blogs/MarkFaulksBlog/tabid/86/Default.aspx


(Yeah, I know, this is my fourth commentary in the past four days. It’s just been one of those weeks.)