The SEC is either inept or corrupted, and the Treasury may be too (Opinion)

The End of the Financial World as we Know it
and then
How to Repair a Broken Financial World

In a pair of Op-Ed pieces, we get a distillation of the various bizarre actions of different governmental bodies (the SEC, the Treasury) and private institutions whose very existence was supposed to be the product of (and a contributor to) a salubrious financial system (investment banks, credit-rating agencies). The first article blames a short-term profit mindset in the private sector that placed immediate, competitive profits over sustainability as the highest priority. Regulators and the Treasury seemed concerned more with maintaining a good image and propping up stock price than with fixing the real problems that were occurring. The first article talks mainly about the Security and Exchange Commission, a body that was initially designed to protect investors from financial predators, now seemingly insulating the most wealthy in the financial markets from punishment. The reason offered is that most of the influential SEC brass go on to make vastly more money on Wall Street once they leave the SEC-- so doing anything to hurt the financial markets will probably hurt one's future career, too. The first article also aims at credit rating agencies, whose malfeasance was almost laughable, giving AAA ratings to firms with abhorrent debt ratios. The analysis is that they too were unwilling to bite the hands that feed them: they are paid by the debt issuers.

The second article deals with the Treasury and the erratic actions that were taken with Paulson at the head, which did not accomplish his stated goals of restoring confidence or to unfreeze the credit markets. The libertine and irrational nature of the bailout has caused a flight of creditors from solvent companies seemingly because they weren't backed by the government. The Treasury seemed deeply concerned with propping up stock price and yet unwilling to buy common stock (a true capital injection) but preferred stock instead (which is more like a loan because it requires regular interest payments). The end result is that many bankers keep their jobs and the root problems continue. The article ends with a variety of very reasonable policy proposals, among them: "Another good solution to the too-big-to-fail problem is to break up any institution that becomes too big to fail."