David Einhorn’s ‘Must-Read’ Speech Exposing Lehman’s Lies

Here is a nice quote from Einhorn's speech:

The SEC seems much more interested in whether investors share analysis, particularly critical analysis, of public filings rather than whether management teams made accurate public filings in the first place. The SEC seems more interested in whether investors discuss investments among themselves on private phone calls than in whether management teams make truthful statements on public conference calls. The SEC seems more likely to bring a case against an individual investor over a small crime than it is to prosecute a large corporation that fudges its numbers for years on end and pays out management bonuses in the millions based on inflated accomplishments.

Good stuff. The dirty little secret of the uproar amidst the current crisis is that the worst stuff was done in plain view of the regulators, if not with their implied consent and stamp of approval. The regulators seem more interested in the surface appearance of honesty and transparency than in substantive truth. Appearances are always much easier to maintain, after all.

I'm beginning to think the average big bank is as bad or worse than the worst of the hedge funds. And that's because they have the regulators on their side, or in their pocket. Or they are the regulators...