Monday, June 18, 2007

Supreme Court Says Wall Street Has No Peers


The Supreme Court smacked down investor class action suits against big Wall Street firms and investment houses accused of defrauding shareholders. Their logic included that juries made up of common folk couldn't possibly understand the highly technical world of high finance, especially that of opening day independent public offerings. The problem is the Supreme Court action may cut off all investor class action suits under anti-trust law, including those regarding Enron's fictional accounting aided and abetted by those same Wall Street firms.

On the bright side, it looks those record quarterly earnings for investment houses could keep going. Enron, once the nation's seventh-largest company, had such a string before their collapse. Enron entered bankruptcy proceedings in December 2001 after Wall Street aided accounting tricks over a number of years could no longer hide billions in suffocating debt or make failing ventures appear profitable. Might any patterns repeat themselves?

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