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To: Uncle Bill
Let's go Crazy (:-) and BOLD that one detail -----

"Now, notice that Evans states that Bush called them in a meeting in early January to start taking care of all these serious problems with accounting scandals. Early January. Early January. Maybe Harvey Pitt was sleeping and forgot to take notes. Or worse, maybe Harvey wasn't even invited."

198 posted on 07/15/2002 5:38:52 AM PDT by rdavis84
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To: rdavis84; Donald Stone
Speaking of manipulation, fraud, cooking the books and insider trading:

Plunge Protection Team

The Washington Post
By Brett D. Fromson
Washington Post Staff Writer
Sunday, February 23, 1997; Page H01

It is 2 o'clock on a hypothetical Monday afternoon, and the Dow Jones industrial average has plummeted 664 points, on top of a 847-point slide the previous week.

The chairman of the New York Stock Exchange has called the White House chief of staff and asked permission to close the world's most important stock market. By law, only the president can authorize a shutdown of U.S. financial markets.

In the Oval Office, the president confers with the members of his Working Group on Financial Markets -- the secretary of the treasury and the chairmen of the Federal Reserve Board, the Securities and Exchange Commission and the Commodity Futures Trading Commission.

The officials conclude that a presidential order to close the NYSE would only add to the market's panic, so they decide to ride out the storm. The Working Group struggles to keep financial markets open so that trading can continue. By the closing bell, a modest rally is underway.

This is one of the nightmare scenarios that Washington's top financial policymakers have reviewed since Oct. 19, 1987, when the Dow Jones industrial average dropped 508 points, or 22.6 percent, in the biggest one-day loss in history. Like defense planners in the Cold War period, central bankers and financial regulators have been thinking carefully about how they would respond to the unthinkable.

An outline of the government's plans emerges in interviews with more than a dozen current and former officials who have participated in meetings of the Working Group. The group, established after the 1987 stock drop, is the government's high-level forum for discussion of financial policy.

Just last Tuesday afternoon, for example, Working Group officials gathered in a conference room at the Treasury Building. They discussed, among other topics, the risks of a stock market decline in the wake of the Dow's sudden surge past 7000, according to sources familiar with the meeting. The officials pondered whether prices in the stock market reflect a greater appetite for risk-taking by investors. Some expressed concern that the higher the stock market goes, the closer it could be to a correction, according to the sources.

These quiet meetings of the Working Group are the financial world's equivalent of the war room. The officials gather regularly to discuss options and review crisis scenarios because they know that the government's reaction to a crumbling stock market would have a critical impact on investor confidence around the world.

"The government has a real role to play to make a 1987-style sudden market break less likely. That is an issue we all spent a lot of time thinking about and planning for," said a former government official who attended Working Group meetings. "You go through lots of fire drills and scenarios. You make sure you have thought ahead of time of what kind of information you will need and what you have the legal authority to do."

In the event of a financial crisis, each federal agency with a seat at the table of the Working Group has a confidential plan. At the SEC, for example, the plan is called the "red book" because of the color of its cover. It is officially known as the Executive Directory for Market Contingencies. The major U.S. stock markets have copies of the commission's plan as well as the CFTC's.
Click Here For Remaining Article


THE PLUNGE PROTECTION TEAM


Securities and Exchange Commission Approves New Circuit Breaker Levels

FOR IMMEDIATE RELEASE

April 10, 1998

Source

Washington, D.C., April 10, 1998 -- The Securities and Exchange Commission late yesterday approved new circuit breaker trigger levels for one-day declines in the Dow Jones Industrial Average (Dow) of 10%, 20% and 30%. The new levels, which go into effect April 15, 1998, were proposed by the securities exchanges and the NASD to modify their rules regarding coordinated, cross-market trading halts during periods of extraordinary market volatility.

The new trigger levels will be converted into point values at the beginning of each calendar quarter, using the average closing value of the Dow for the previous month. The new levels also better reflect the original intent of the circuit breakers: that they only be triggered during a severe one day decline of historic proportions. The Commodities Future Trading Commission also approved substantively identical rules for the stock index futures markets.

The rule changes also modify the late-in-the-day trading halt procedures for circuit breakers.


199 posted on 07/15/2002 1:49:28 PM PDT by Uncle Bill
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To: rdavis84; Donald Stone
Bush's Document Dilemma: Should he release the Harken SEC documents? Byron York Says Yes
200 posted on 07/15/2002 2:02:22 PM PDT by Uncle Bill
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