You've probably never heard of the Securities Investor Protection Corporation. It was created by the congress. But it is privately run, one of those intricate mixed breeds about which it is hard to discern who or what is responsible for failure. And failure is surely on its way, as Michael Kranish reports in Friday's Boston Globe.
Every brokerage company buys insurance. Whether it is Goldman in New York or Daisy Mae in Dog Patch, each firm pays $150 -that's all- to insure all of its accounts up to $500,000. This is very cheap insurance.
But it is no longer so cheap. And the question is whether the $1.5 billion S.P.I.C. has bundled away somewhere will be enough to cover the agency's obligations. Which, by the way, include both Madoff's and Sanford's heists on the investment markets.
One piece of good news: Barney Frank will do something about it. But maybe it's too late for him to save every one.