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Jared Dillian
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Was it Worth It?

In this piece from 10th Man, author Jared Dillian discusses how the ETF revolution is less about ETFs and more about indexing; about how people have come to view stocks less as stocks and more as blobs of stocks.

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March 1, 2002

NYSE Policy Defended Despite Enron Collapse

By Gregory Bresiger

The New York Stock Exchange has adequate listing regulations and no changes are needed in light of the Enron disaster, according to several trading pros.

"The NYSE has reasonable standards in place," according to Robert Fagenson, a Big Board specialist with Van der Moolen Specialists. "The NYSE are not auditors of these companies," he said, referring to Enron, the energy trader delisted on Jan. 15.

"Crooks are crooks and they will turn up in almost any business," added Cromwell Coulson, chief executive of the Pink Sheets, the OTC market that picked up Enron. "They fooled everyone. It's wrong to put the blame on the NYSE."

"The Big Board," said an industry official who works with specialists, "acted in a reasonable and orderly manner. They delisted the company as soon as they found out about the fraud." This official said any blame for fraud should be with the audit committee of the Enron board, the company's own accountants or the outside accountants.

"They're the ones who should have sniffed it out," he added. "The stock exchange received no insider information about the problems. How could they have known?"

Still, NYSE officials believe there is a problem because of Enron. Said NYSE Chairman and CEO Dick Grasso: "We will work in tandem with the legislative and regulatory bodies to restore public confidence." Grasso said the Big Board will be calling on its advisory committees, "asking them to tell us what we can do to shore up our system."