Whew! Glad That's Fixed

Finally, the Securities & Exchange Commission has developed a new strategy to combat massive crashes in stock prices such as the one experienced in May. You may remember this incident vividly as the being the only time a stock crash was blamed on a fat fingered trader who typed in "billion" instead of "million". Having been unable to actually find this obese, dim-witted titan of Wall Street as of yet, the SEC was forced to act on the logical assumption that there was no fatty screwing with the Dow, rather it was an actual, market driven occurrence.

Normal, capitalist minded individuals would look at a massive stock crash and try to examine the reasons how it could have happened. Europe's credit collapse, rampant American debt and sagging credit, the current administration's hostility to all non-crony related forms of capitalism are all plausible theories that spring to mind.

Unfortunately, the United States bureaucracy is not populated by normal, capitalist minded individuals.

The solution devised by the SEC is to monitor stock prices over a floating time frame and if there is a massive devaluation of stock prices, to simply stop trading.

Awesome.

Nothing more to see here folks! No need to figure out why your investment is worth about 1/32 what it was five minutes ago. Big brother stopped trading, don't you feel better now?

You shouldn't. This plan won't work because the underlying problems aren't being addressed. Trading can't be halted forever and as soon as the freeze is lifted, whatever root causes were in play before will be in play again.

Finances are like a river. You can't stop the flow, you can only dam, divert or delay. All those things can do is buy you time. You ultimately have to fix the main problem. If you don't, those tactics will fail and the failure is often times more spectacular and costly than the original problem you were trying to avoid.