[ding_dong_daddy_from_dumas]

SOX was supposed to prevent abuses and protect shareholders from corruption and fraud by CEOs / CFOs / CxOs (which was not the cause of this meltdown)

And what do you think the cause was?

[CutePuppy]

As is often in bubbles, there wasn't just one cause. See my post #16 for several of them propagating the moral hazard behind this one, all having to do with government's policies, laws and regulations. Having Democrats in charge of Congress, doing everything possible to make economy much worse than it could have been, for their electoral purposes, simply exacerbated the financial crisis. I think we can see it clearly every day now.

This crisis is far more dangerous than mere bubbles because it affects entire financial system, not just an industry or a sector of the economy as the case was in more recent bubbles. But outright Enron-style fraudulent balance sheets (like off-balance liabilities and side-agreements) or inflated income statements, which is what SOX was supposedly designed to prevent, was not one of the causes.

Politicians and government bureaucrats who have either sponsored or have stood in the way of fixing the worst problems causing the bubble (such as GSEs Fannie and Freddie) would like to misdirect our attention from themselves and point fingers at "greedy" or "incompetent" CEOs or at "deregulation" or at Republican administrations, but it was their own legal and political actions and inactions (such as refusing restructuring and deleveraging of GSEe as advocated by Bush in 2001 and later, in 2005) and the moral hazard that they introduced that have been the primary reasons and "stimulus" behind this fiasco.

In other words, excess of politically motivated regulations of private markets and economy have led to this being significantly more than just a natural business cycle slowdown, not the "inadequate regulation" as the article claimed.