What have you always wondered about the economy? Tell Us

SEC wades into subprime mess

Jeremy Hobson Aug 10, 2007

TEXT OF STORY

Scott Jagow: There’s more to this story. The Securities and Exchange Commission is getting involved. The SEC wants to make sure Wall Street firms aren’t hiding any subprime losses. More now from Jeremy Hobson.


Jeremy Hobson: We’re talking about big, respected firms like Goldman Sachs and Merrill Lynch. And University of Delaware corporate governance professor Charles Elson says the SEC is doing the right thing.

Charles Elson: Totally appropriate and no surprise, given the turmoil in the credit markets.

Elson says the SEC has a responsibility to give shareholders in these firms an accurate picture of what’s going on.

Elson: These securities that are in question are not typically traded on well-established securities markets. So it’s hard to establish their precise value, but these are assets that affect these institutions’ financial health.

Neither Goldman Sachs nor Merrill Lynch would confirm that the checks were going on. A Merrill Lynch spokesman said only, when the firm is asked by regulators for information, it cooperates.

In Washington, I’m Jeremy Hobson for Marketplace.

News and information you need, from a source you trust.

In a world where it’s easier to find disinformation than real information, trustworthy journalism is critical to our democracy and our everyday lives. And you rely on Marketplace to be that objective, credible source, each and every day.

This vital work isn’t possible without you. Marketplace is sustained by our community of Investors—listeners, readers, and donors like you who believe that a free press is essential – and worth supporting.

Stand up for independent news—become a Marketplace Investor today with a donation in any amount.