EAGLE ON THE STREET

An unsparingly critical, albeit evenhanded, audit of the SEC's efforts to police Wall Street during the volatile 1980's; based on a series of Washington Post articles that earned its authors a 1990 Pulitzer Prize. Coll (The Taking of Getty Oil, etc.) and Vise focus on the stewardship of John Shad, the agency's chairman during the deregulatory heyday of the Reagan Administration. They give the ex- Hutton executive full marks for a number of bold initiatives, including foresighted campaigns against insider trading, establishment of a Chief Economist's office, resolution of long- running turf battles with commodities authorities, outspoken opposition to LBO/takeover excesses, and concern for shareholder welfare. But authors fault Shad on a number of counts. By their book, for example, his hands-off approach to capital markets helped precipitate the 1987 crash; he often was oblivious to conflicts of interest and the political implications of his agency's decisions; and he was an indifferent administrator whose department heads frequently worked at cross purposes. According to the authors, Shad also failed to contain a sexual-harassment scandal that could have been settled early on. Coll and Vise make clear, though, that the financial world was an eventual venue on Shad's watch. With the likes of Ivan Boesky, Carl Icahn, Dennis Levine, and Michael Milken on the prowl, they note, the SEC's capacity to enforce securities laws was stretched to the limit, owing largely to the White House's bias toward laissez-faire and lean operating budgets. Even so, the authors conclude, the agency emerged intact from a turbulent era. Despite minor errors throughout (the authors seem to believe, for instance, that any bond with a letter rating is investment- grade): a savvy, wide-ranging recap of a decade notable for a wealth of financial folly and a reluctant top cop walking the market beat.