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Description:

What's the SEC? Easy. Seals Eating Candy. Or maybe Silly Elephants Canoodling? We can never remember. Guess it's time to watch this video and refresh our memories.


Transcript

00:03

Finance a la shmoop what is the SEC right well the SEC or

00:09

Securities Exchange Commission has nothing to do with a realtor getting 6% [Realtor receiving a cheque off a man]

00:15

Commission when they sell your house commission here is about committing to

00:20

do right by investors well why do we have a whole commission or army of [An army of men wearing suits and facepaint]

00:24

lawyers dedicated to the fair exchange of securities well because there was an

00:29

era brutally demonstrated in the 1920's when fast-talking sleazy wheelers and dealers

00:35

ripped off everyone from ma and pa kettle to aunt an uncle teapot yeah they would [Dealer ripping off people in the street]

00:42

prey upon the uneducated the uninformed the gullible the greedy painting stories

00:48

of great riches that the would-be investors could have if they just sold [Man telling a farmer to invest his land]

00:52

their twenty thousand acre farm and parted with ten grand to buy this

00:57

beautiful park that real estate developers wanted to turn into high-rise [Farmer receives a real-estate development]

01:01

condos but in fact many of those lands were actually swampland the only folks [Farmer holding a shovel in a swampland]

01:07

who might be moving in there were beavers deer flies and alligators and it

01:11

wasn't just real estate securities that were abused fake companies Lego bridge [Officer on stage waving baton]

01:17

building company bumper stickers R Us you know like that sprung up everywhere

01:22

with crazy promises that sounded plausible to those with barely a [Boy in a white vest beside a bumper sticker]

01:26

third-grade education but they were total scams the American public tired of

01:31

reading about uneducated investors losing all their money to fast talking [American man reading about investors]

01:35

sales people lobbied Congress to create the SEC in 1934 with its core pursuit [People protesting outside of congress]

01:41

being to regulate the buying and selling of securities in America yep pretty much

01:47

[Policeman blows his whistle] these were the investing police myriad laws and structures were put into place

01:52

mainly around full and fair disclosure of whatever security a money raising

01:56

company was selling that is if it really was swampland you had to disclose that [Man with an aligator for a head in a swampland]

02:03

it was swampland you couldn't claim it was something it wasn't using fancy

02:07

vocabulary that a normal ordinary person couldn't [Man confusing someone with fancy vocabulary]

02:11

understand like you couldn't you know polish a piece of crap and call it

02:16

marble the broader goal here was not to give Americans advice on what to buy and [American boy thinking about buying or selling]

02:21

sell but rather just to have full and fair disclosure of the facts so that

02:27

when a buyer did buy and got taken well at least then all the facts she needed [Woman meeting with an investor]

02:32

to make a rational and reasonable conclusion were right there in front of

02:36

her so hey anyone up for a game of marbles [Man throwing poo on the floor]