I am confused by the recent argument for more financial regulation. The argument seems to go that because Goldman Sachs may have committed fraud, then we need more laws making more things illegal. But Goldman Sachs is accused of breaking existing laws. Isn't that just an argument to enforce the laws we already have? In fact, the government so far is stopping short of its full power to go after Goldman over the Abacus securities -- its seems like they would have a criminal fraud case but at the moment they are settling for a civil action. In a sense, the government is not using against Goldman all the power it already has.
Of course, a cynical person could argue that the government has no real desire to go after Goldman, who after all is pretty deeply in bed with this Administration, and is pulling its punches in a show trial that will end up with Goldman fined .01% of its quarterly profit but with the Administration looking tough to fuzzy-headed voters and with Congress having something it can wave around to distract people while it passes another 1400 page bill no one has read.