Proverbs 24:5-6
(NASB): “A wise man is strong, And a person of knowledge increases power. For by wise guidance you will wage war, And in an abundance of counselors there is victory.”
(NIV): “The wise prevail through great power, and those who have knowledge muster their strength. Surely you need guidance to wage war, and victory is won through many advisers.”
(ESV): “A wise man is full of strength, and a man of knowledge enhances his might, for by wise guidance you can wage your war, and in abundance of counselors there is victory.”
(LBLA): “El hombre sabio es fuerte, y el hombre de conocimiento aumenta su poder. Porque con dirección sabia harás la guerra, y en la abundancia de consejeros está la victoria.”
Sources:
(2) https://corporatefinanceinstitute.com/resources/equities/1933-securities-act-truth-securities/
(3) https://www.govinfo.gov/content/pkg/COMPS-1885/pdf/COMPS-1885.pdf
(4) https://www.law.cornell.edu/wex/securities_exchange_act_of_1934
(5) https://www.investopedia.com/terms/s/seact1934.asp
(6) https://www.sec.gov/about/sec-commissioners
(7) https://www.federalreservehistory.org/essays/stock-market-crash-of-1929
(8) https://thehustle.co/the-banker-who-caused-the-1929-stock-crash
(9) https://www.law.cornell.edu/wex/regulation_fair_disclosure_(fd)
(10) https://www.law.cornell.edu/wex/material
(11) https://www.law.cornell.edu/wex/form_8-k
(12) https://shareholder.ford.com/Investors/financials/default.aspx
(13) https://d18rn0p25nwr6d.cloudfront.net/CIK-0000037996/26bf6e5f-2dbe-4224-8076-4714cb8f170e.pdf — [Ford Motor Co. Form 8-K filed on Feb 5th, 2025]
(14) https://guides.ll.georgetown.edu/c.php?g=365494&p=2755536#:~:text=The%20%E2%80%9934%20Act%20extended%20federal%20regulation%20of%20securities%20trading%20to%20securities%20already%20issued%20and%20outstanding.
(15) https://guides.loc.gov/this-month-in-business-history/june/signing-securities-exchange-act-1934
(16) https://www.britannica.com/event/stock-market-crash-of-1929
(17) https://www.sec.gov/rules-regulations/statutes-regulations#secexact1934
(18) https://www.sec.gov/search-filings
(19) Federal Register: Regulation Best Interest – The Broker-Dealer Standard of Conduct
(20) SEC Regulation Best Interest (Reg BI) FINRA
(21) https://www.finra.org/investors/insights/sec-regulation-best-interest-and-form-crs-what-you-need-know
For additional information about the SEC & the Securities Act of 1933, click here.
The Securities Exchange Act of 1934
The History: Securities Exchange Act of 1934
The Securities Exchange Act of 1934, was enacted by President Franklin D. Roosevelt’s administration as a follow-up to the Securities Act of 1933.
The Securities Exchange Act of 1934 was signed by President Roosevelt on June 6th, 1934.
President Roosevelt’s administration created other regulatory acts, such as the: Public Utility Holding Company Act of 1935, the Trust Indenture Act of 1934, the Investment Advisor Act of 1940, and the Investment Company Act of 1930.
The Securities Act of 1933 regulates newly issued securities through the primary market. The Securities Exchange Act of 1934 regulates security transactions on the secondary market. The secondary market trades securities already issued and outstanding.
The Securities Exchange Act of 1934 was a response to financial practices that led to the 1929 stock market crash. The 1929 stock market crash had impacts that rippled globally through foreign central banks, and impacted commerce and manufacturing the most.
What Does The Act Actually Do !?!
The Securities Exchange Act of 1934 is “an act to provide for the regulation of securities exchanges and of over-the-counter markets operating in interstate and foreign commerce and through the mails, to prevent inquitable and unfair practices on such exchanges and markets, and for others purposes.” The word mails also refers to “instrumentalities of interstate commerce” which is found on Sec. 3, page 2 of the Securities Exchange Act of 1934.
The Securities Exchange Act of 1934 “regulates trading on the secondary market and major stock exchanges, as well as participants in these markets” such as “brokers, transfer agents, and clearing agencies” and certain “self-regulatory organizations.”
Public companies with more than $10 million in assets with securities held by more than 500 owners must file annual reports made available through the SEC’s EDGAR database.
Establishing The SEC
The Securities Exchange Act of 1934 established the SEC–as an independent agency–to govern securities trading to ensure “transparency, fairness, and an environment of investor confidence.”
The SEC is empowered to bring an action in federal court or settle outside a trial. Some of these actions occur due to: insider trading, selling of unregistered stocks, misuse of consumer funds, market manipulation, false information, and the breach of broker-customer integrity.
The Securities Exchange Act of 1934 allows the SEC to regulate & oversee the: New York Stock Exchange, NASDAQ, Chicago Board of Options and FINRA.
The SEC is led by five commissioners, all of which are “appointed by the Preisdent on the advice and consent of the Senate. No more than three Commissioners can be members of the same political party.” Additionally, the President elects one of the Commissioners to be Chairman, which is the SEC’s top executive leader.
The Commission must receive information utilized in corporate proxy materials in advance of the shareholder meeting.
The Original Commissioners Under President Roosevelt Starting in 1934.
The Current Commissioners Under President Trump as of 2/26/2025.
The current SEC Commissioner appointed to be Acting Chairman is Mark T. Uyeda.
The other two Commissioners are Hester M. Peirce & Caroline A. Crenshaw.
Proverbs 24: 21-22
(NASB): “My son, fear the LORD and the king; Do not associate with those who are given to change, For their calamity will rise suddenly, And who knows the ruin that comes from both of them?”
(NIV): “Fear the LORD and the king, my son, and do not join with rebellious officials, for those two will send sudden destruction on them, and who knows what calamities they can bring? ”
(ESV): “My son, fear the LORD and the king, and do not join with those who do otherwise, for disaster will arise suddenly from them, and who knows the ruin that will come from them both?”
(LBLA): “Hijo mío, teme al Señor y al rey, no te asocies con los que son inestables; porque de repente se levantará su desgracia, y la destrucción que vendrá de ambos, ¿quién la sabe?”
Regulation FD
Congress utilized the Securities Exchange Act of 1934 to create a mandatory disclosure process of information that investors would find material to their investment decisions.
Regulation FD “is the primary section of the Exchange Act which discusses disclosures.” These disclosures can be found on the EDGAR database mentioned earlier.
Regulation FD “requires public companies to disclose material non-public information which they shared with private individuals.” Regulation FD helps ensure that investors of all types have equal access to material disclosures at the same time.
Usually, Regulation FD disclosures are filed on Form 8-K.
Form 8-K’s are filed “whenever a material event occurs” making Form 8-K’s “one of the most filed SEC forms.”
Material events that require a public company to file a Form 8-K report to be filed with the SEC can include:
“entry into or termination of a material definitive agreement, bankruptcy, completion of acquisition or disposition of assets, results of operations and financial condition, unregistered sales of equity securities, changes in registrant’s certifying accountant, changes in control of registrant, changes in or election of directors and officers, amendments to articles of incorporation or bylaws, submissions of matters to a vote of security holders, Regulation FD disclosure, and financial statements and exhibits.”
Regulation BI: Regulation Best Interest
The SEC adopted a new rule under the Securities Exchange Act of 1934 called Regulation Best Interest.
FINRA has a webpage dedicated to Regulation Best Interest with plenty of important additional information.
Regulation Best Interest (Reg BI) went into effect on September 10th, 2019.
The Federal Register quotes as follows:
“Regulation Best Interest enhances the broker-dealer standard of conduct beyond existing suitability obligations, and aligns the standard of conduct with retail customers’ reasonable expectations by requiring broker-dealers, among other things, to: Act in the best interest of the retail customer at the time the recommendation is made, without placing the financial or other interest of the broker-dealer ahead of the interests of the retail customer; and address conflicts of interest by establishing, maintaining, and enforcing policies and procedures reasonably designed to identify and fully and fairly disclose material facts about conflicts of interest, and in instances where we have determined that disclosure is insufficient to reasonably address the conflict, to mitigate or, in certain instances, eliminate the conflict.
The standard of conduct established Regulation Best Interest cannot be satisfied through disclosure alone.
The standard of conduct draws from key principles underlying fiduciary obligations, including those that apply to investment advisers under the Investment Advisers Act of 1940 (“Advisers Act”).
Importantly, regardless of whether a retail investor chooses a broker-dealer or an investment adviser (or both), the retail investor will be entitled to a recommendation (from a broker-dealer) or advice (from an investment adviser) that is in the best interest of the retail investor and that does not place the interests of the firm or the financial professional ahead of the interests of the retail investor.”
An annual conference speech by FINRA called “The Progression of Regulation Best Interest and Form CRS” highlights some changes occurring within Regulation BI. This is worth checking out.
Proverbs 24:33-34
(NASB): “A little sleep, a little slumber, A little folding of the hands to rest, Then your poverty will come like a drifter, And your need like an armed man.”
(LBLA): “Un poco de dormir, un poco de dormitar, un poco de cruzar las manos para descansar, y llegará tu pobreza como ladrón, y tu necesidad como hombre armado.”
(YLT): “A little sleep — a little slumber — A little folding of the hands to lie down. And thy poverty hath come [as] a traveller, And thy want as an armed man!”
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