Friday, 12 December 2014
Who Regulates The Regulators?
The Ponzi pyramid of self-justification that underpins all free market structures is always a part of the problem rather than a part of the cure.
Who guards the guardians?
Who governs the governors?
Who moderates the moderators?
Who regulates the regulators?
The Financial Conduct Authority (FCA) is not fit for purpose.
Nine out of 12 board members were simply parachuted across from the board of the disbanded FSA - that's the FSA that failed to suitably regulate the banks prior to and during the 2007/08 crash.
The FSA's regulatory style was so light touch as to be reiki.
The FSA was a prime example of regulatory capture -a form of political corruption that occurs when a regulatory agency, created to act in the public interest, instead advances the commercial or special concerns of interest groups that dominate the industry or sector it is charged with regulating.
In response, the FCA need to be seen to be doing their regulatory role with the utmost integrity.
Bizarrely, the FCA created a false market in major insurers' shares after botching a press briefing - the share prices of major insurers plunged after the Telegraph published the story.
A 225 page report released this week goes further: "The strategy and manner in which [the media strategy] was pursued was... high risk, poorly supervised and inadequately controlled. When it went wrong, the FCA's reaction was seriously inadequate and fell short of the standards expected of those it regulates."
The regulator tilted the markets!
And the FCA response is to repay some executive bonuses received in an extended window of self-justification and to immediately rush out a long delayed report into the mis-selling of annuities in a blatant display of exactly the sort of public relations and branding that regulatory bodies should not be in business of needing to undertake.
But this the norm - other recent examples include OFWAT mistakenly overestimating water companies' capital costs when setting price levels and then refusing to impose London Stock Exchange disclosure requirements on non-stock market listed companies, or PricewaterhouseCoopers selling tax avoidance on an industrial scale with the strategy only coming to public knowledge via internal leaks.
Why is it nearly always whistleblowers and (Wiki)leakers and very rarely regulatory bodies and institutional self-policing that reveals financial miscreants?.
The big picture is one of pure Randian psychopathy - there is minimal red tape to act as obstacles for the steady flow of sociopathic outsiders who join the psychopathic insiders as cowboy capitalism races to the bottom of the barrel...
... but in the world of football, the situation is worse.
Nothing is regulated on any primary level of operation and there are supportive and corrupted flow networks integrated globally to prevent any hope of integrity.
All six of the primary bodies allegedly looking into football integrity and matchfixing are compromised in their purpose via their ownership.
Indeed, in certain cases, a more mottley crew of interested parties could not have been created even if one had set out explicitly with such purpose!
Fragmented cartels of corruption - self-justification and self-interest!
Football governance verges on the non-existent and, even at best, is merely a branding and self-justification process.
Certain entities and structures are systemically corrupt...
... in fact, I'll rewrite that sentence - there are very few bodies and networks in global football that are not systemically corrupt!
Regulation is invisible or malleable self-regulation that equates to no regulation at all - agents, dark pools, betting markets, insider trading, matchfixing, third party ownership, mainstream media compliance in a restricted narrative while, once again, whistleblowers and (Wiki)leakers expose, bottom-up, what any decent system would implement top-down.
Inversion capitalism - asset stripping and financial profiteeering from the monetising of a brand, tax avoidance and evasion, antisocial competition practices with minimal regulation (for self-justification) alongside state punishment for 5th Estate types who get in the way - the Obama administration has started more prosecutions against whistleblowers than all presidents combined over the last century.
20 whistleblowers have been murdered in India in the last five years.
FIFA, the FCA, UEFA, PwC, the Premier League, Barclays, the Glazers, the FA Sports Betting Integrity Unit, Gestifute, Goldman Sachs, all these oil companies from interesting geopolitical locations that are buying up British football teams, private equity, dark pools, the control of whistleblowing bodies by those who should be whistleblown, derivatives markets, offshore financial centres and markets, NGO-lite structures etc - pure neo-Bayesian corruption entities beyond the reach of economic theory that can only be reactive to this juggernaut of inversion free-marketry where there are no rules.
Who regulates the regulators?