What do Faulkner, Hemingway and even Ibsen have to say about the conversion of the New York Stock Exchange into a publicly traded, for-profit company and its implications for self-regulatory organizations in the securities industries?
Well, enough at least to contribute to the testimony of two speakers at the March 9 Senate Banking, Housing and Urban Affairs Committee hearing on self-regulatory organizations, an unlikely subject for these authors of classic literature. (Click for a news report on the hearing.)
Marc E. Lackritz, president of the Securities Industry Association, Washington, testified, "(N)o matter how capable the regulators or how valiant their efforts to reconcile their rules, in light of the variations in institutional culture, history and constituency among the NYSE and NASD, just synthesizing their rules will be inferior to what could be produced by a single regulator. Think of the result if Hemingway and Faulkner sought to ‘harmonize' their work."
Henry T. C. Hu. professor in the law of banking and finance, University of Texas School of Law, Austin, also testified at the hearing: "When the playwright Henrik Ibsen was ill, a nurse came to take a look. The nurse said to Ibsen that he ‘seemed to be a little better. Ibsen said ‘on the contrary' — and died. It is important to go beyond a quick look (at self-regulatory organizations). It is important to go beyond stated goals and to try to assess whether the legal and market mechanisms in place will in fact nurture and sustain those goals. I say ‘maybe.'"
And maybe the subject isn't so unlikely after all at least for Faulkner, who named one of the characters in his novels Wallstreet Panic Snopes. But Mr. Lackritz probably wouldn't want to take his analogy there.