Should the Securities and Exchange Commission even exist? Does the S.E.C. perform the tasks it is charged with effectively? Of course we all want functioning, transparent, and regulated markets that abide by the rules of law, and the applicable contracts and covenants; however the S.E.C. has proven to be an utter and complete failure in accomplishing this.
Do you invest under the assumption that the Securities and Exchange Conundrum protects you and your money from fraud, abuse, and market manipulation? In reading David Einhorn's Fooling Some of the People All of the Time, one can find this (amongst many, many other) highlights on page 399:
In a desperate attempt to prop up share prices, the Securities and Exchange Commission implemented a ban on short selling of financial stocks. This emergency action, approved outside the usual government rule-making process and unsupported by any factual finding that short selling was indeed a problem, caused a 21 percent two-day spike in the New York Stock Exchange (NYSE) Financial Index in September 2008. The SEC, charged with fighting market manipulation, instead sponsored the greatest manipulation in history. It was short lived and ineffective, and ultimately contributed to investors losing confidence in the system. By the time the ban was lifted a month later, the NYSE Financial Index had already fallen 11 percent from its preban level--on its way to collapsing 68 percent between its September peak and March 2009 low.