Raising start-up capital is a tough job even in good economic times. These days, with credit so scarce, it can seem nearly impossible. Unfortunately, when entrepreneurs want to get things done “in the worst way,” they sometimes run out of patience and do just that. Raising capital in 21st century America is a bit like taking a road trip across Iraq. The road is strewn with booby traps. Continue reading
The Bear Stearns collapse, like Enron and Worldcom before it, has prompted loud cries for more and better market regulation: Higher quality accounting standards! Better internal controls! More rigorous enforcement! But haven’t we been getting all this in an ever-rising spiral since 1934? The headline below captures the spirit of the times — New York Times, July 4, 1934, to be precise.
Next year will mark the 75th anniversary of the founding of the U.S. Securities and Exchange Commission. It was created as a political response to the market crash of 1929. Like politicians today, those back then had to be seen as “doing something” to “protect” investors. They thought they had the answer — more regulation. Or at least they wanted voters to believe this was the answer. Continue reading