The Securities And Exchange Commission :: essays research papers

The Securities and Exchange commitmentIn 1934 the Securities Exchange make believe created the mo (Securities and Exchange Commission) in reaction to the stock grocery store crash of 1929 and the Great Depression of the 1930s. It was created to protect U.S. investors against malpractice in securities and financial markets. The purpose of the SEC was and still is to carry out the mandates of the Securities Act of 1933 To protect investors and maintain the integrity of the securities market by amending the current laws, creating brand-new laws and seeing to it that those laws are enforced.During the 1920s, approximately 20 million Americans took advantage of post-war prosperity by purchasing shares of stock in various securities exchanges. When the stock market crashed in 1929, the fortunes of many investors were lost. In addition, banks lost great sums of money in the Crash because they had invested heavily in the markets. When people feared their banks might not be able to pay back the money that depositors had in their accounts, a grade on the banking system caused many bank failures. After the crash, public trustfulness in the market and the economy fell sharply. In response, Congress held hearings to chance on the problems and look for solutions the answer was found in the new SEC. The Commission was completed in 1934 to enforce new securities laws that were passed with the Securities Act of 1933 and the Securities Exchange Act of 1934. The deuce new laws stated that Companies publicly offering securities must tell the public the truth about their businesses, the securities they are selling and the risks involved in the investing. Secondly, slew who sell and trade securities must treat investors fairly and honestly, putting investors interests first.2     Franklin Delano Roosevelt defeated Herbert Hoover in a landslide in the 1932 preference and began to work on his New galvanic pile. In the New Deal four key regulatory bodi es were established The National Labor traffic Board, Civil Aeronautics Authority, Federal Communications Commission, and the Securities and Exchange Commission. Wall roadway was not enamored with the coming regulation, but Congress was confident that the highway was seen as an easy target for the Crash and the Depression that followed. In response, the SEC was created by Congress on June 6, 1934 for the purpose of protecting the public and the soul investors against malpractice in the financial markets. Commenting on the creation of the SEC, Texas Congressman and future talker Sam Rayburn admitted3 he didnt know whether the legislation passed so readily because it was so good or so incomprehensible.