I am not especially happy about McCain’s public criticism of Chris Cox, who I find, in general, to be a pretty good guy. I know his record as a conservative is solid.
However, in the particular case of FNM & FRE, IMO the SEC had an obligation during the time when these companies could or would not submit properly audited financial statements to 1: Force them to add to their trading symbols the suffix “E”, which is a specific suffix that designates companies who.....wait for it.....have not submitted proper financials. (I THINK it is “E”, I could be wrong, but there is a specific suffix for this precise situation of not having submitted financials) Thus, FNM would have become FNME and FRE would have become FREE (!) Well, it’s pretty close! and 2: To threaten them with delisting after some period of time.
ANY OTHER COMPANY ON THE FACE OF THE EARTH that had not submitted financials would have been given this suffix purely as a matter of course AFTER ONE QUARTER and would have likely been delisted after some period of time. FNM could not submit financials for 3 years IIRC.
So I do not think C. Cox is entirely blameless in this. In my view, the SEC has an entirely different mission than what most folks think they do. Sure, they get involved in enforcement actions from time to time but I believe their primary mission is the promotion of the stock exchanges.
Look, Cox is a good Conservative, and McCain knows it, but this happened on his watch, and in ‘07 he suspended the rules about uptick trading. Cox needs to step up by stepping down so he can explain himself and dump all over Bambi.
McCain doesn’t really blame Cox, but Cox was captain of the ship when the iceberg got in the way.
Best,
Chris