Did you notice that Obama signed the JOBS Act into law last week? No, this was not the American Jobs Act which the Republicans stonewalled; it is the Jumpstart Our Business Startups Act which originated with the Republicans in the House. But it had the support of Obama, half of the Democrat Senators and 70% of the Democrats in the House. Matt Taibbi (famous for calling Goldman Sachs a vampire squid) has been extremely harsh on Obama, HERE and HERE.
Because it touted the success of the Silicon Valley startups, the bill was sometimes called the Steve JOBS Act, even though his company, Apple, was incorporated back in 1977 and is hardly a startup anymore. The law was supposed to free startups from regulation to make it easier to raise capital, but critics say that it was unnecessary to remove many rules which protected investors.
Both Maryland Senators, Cardin and Milkulski, and both Howard County members of the House, Cummings and Sarbanes, voted against the bill. Here is the Senate roll-call and here is the House roll-call.
I read both the Matt Tabbi postings.
ReplyDeleteWe should keep in mind that the laws establishing the SEC provide only for INFORMATION for the investor, on the theory that people will understand and act on the facts. All that information has not stopped poor investments. For one thing, people generally ignore the torrent of paperwork from the companies and banks.
This law provides for less information (at less cost to emerging companies).
I imagine the risk of bad investments will be about the same as always.
This was issued by the AARP
ReplyDeleteWashington, DC – AARP Senior Vice President Joyce Rogers issued the following statement today in response to the Senate passage of the “JOBS” Act:
“Despite a successful amendment to a provision of the bill pertaining to crowd funding, AARP remains disappointed that the ‘JOBS’ Act passed by the Senate today lacks vital investor protections and undermines regulations that guard against fraud and abuse. We do not believe weakening investor protections and opening the door to fraud is the best way to create jobs. Without safeguards for proper oversight and regulation, this legislation would heighten the risk to individual investors and threaten market integrity.
“On behalf of older Americans, who with a lifetime of savings and investments are disproportionately represented among the victims of investment fraud, AARP would have liked to see the Senate adopt a more balanced approach. Investors still reeling from the most recent financial crisis deserve better.”