ENDING QUARTERLY EARNINGS REPORTS IS A "BULLY TACTIC."

"Those who cannot remember the past are condemned to repeat it."

On September 15, 2025, Trump renewed his call that public companies "should no longer be forced" to report quarterly. He had made a similar suggestion during his first term in 2018. According to Trump, reducing reporting frequency would allow corporate managers to focus on long-term growth and would save companies money. Meanwhile, the current Securities and Exchange Commission (SEC) chair, Paul Atkins, has indicated that the agency will fast-track a proposal to give companies the option of reporting twice a year. Atkins has stated that he believes the market, not regulation, should determine the optimal reporting frequency.  Supporters of semi-annual reporting argue that it would reduce regulatory costs for businesses and potentially curb "short-termism," where companies prioritize immediate earnings over long-term strategic investments.

BAD IDEA: The history of deregulation in investment in the United States, a movement gaining momentum in the late 20th century, involved removing government restrictions to foster competition and innovation, notably with the 1999 repeal of the Glass-Steagall Act and 2000 deregulation of derivatives. This shift aimed to stimulate economic growth but contributed to financial instability, including the savings and loan crisis and the 2008 financial crisis.

IN HUMAN NATURE, accepting a less restrictive practice (eliminating the quarterly report rule)

in exchange for changing rules on a more important issue like transparency can lead to

a trade-off between freedom and control, where people might prioritize the

immediate benefit of greater personal freedom but risk eroding a

foundational principle of openness and accountability over time.  

Such a circumstance is considered a bully tactic.

Early 20th Century (Pre-Great Depression)

Glass-Steagall Act (1933): Enacted after the Great Depression, it separated commercial banking (deposits, loans) from investment banking (underwriting securities) to prevent risky behavior from destabilizing the financial system. 

Late 20th Century (Shift Towards Deregulation)

Depository Institutions Deregulation and Monetary Control Act of 1980: This act and the subsequent Garn-St. Germain Act of 1982 allowed savings and loan associations to expand their services, contributing to increased competition but also setting the stage for the savings and loan crisis. 

Reinterpretations of Glass-Steagall: Starting in 1986, the Federal Reserve gradually allowed commercial banks to engage in more investment banking activities. 

The Riegle-Neal Interstate Banking and Branching Efficiency Act of 1994: This law removed restrictions on banks operating across state lines. 

Major Deregulation in the 1990s

Gramm-Leach-Bliley Act (1999): This act completely repealed the functional separation of commercial and investment banking, permitting a single financial institution to offer a broad range of financial services. 

Commodity Futures Modernization Act (2000): This legislation exempted over-the-counter (OTC) derivatives, like credit default swaps, from regulation by the Commodity Futures Trading Commission (CFTC). 

Consequences and the 2008 Financial Crisis

Increased Risk-Taking: Deregulation encouraged financial firms to engage in riskier, more complex activities. 

Financial Crises: The savings and loan crisis, the Long-Term Capital Management (LTCM) crisis, and ultimately the 2008 financial crisis were linked to the increased risk and lack of regulatory oversight that deregulation allowed. 

Post-Crisis Reforms

Dodd-Frank Act (2010): In response to the 2008 crisis, this legislation was passed to re-establish regulatory frameworks and prevent future financial instability. 

WHAT'S NEXT?

Assuming the Trump administration proceeds with its current plans to end quarterly reporting, the details are crucial. What would the new world of corporate reporting look like? It's possible that market dynamics would keep much of the information flowing as it does now. Some companies, but not all, would continue to report quarterly. Certainly, we could expect that information would become an even more precious commodity than it is today. Well-placed investors and the other kind will possess a great advantage and make everyone else more vulnerable. Trust in public markets would diminish if regulation receded and transparency will be compromised.

THE HIDDEN AGENDA:

In addition to changing quarterly reporting requirements, the Securities and Exchange Commission (SEC) can reduce transparency by

withdrawing or altering rules, raising disclosure thresholds, and limiting enforcement activity. 

Altering or rescinding disclosure rules

The SEC can change or withdraw rules requiring companies to report specific information, especially concerning non-traditional financial metrics.

• Withdrawing the climate-related disclosure rule: In March 2025, the SEC, under a new administration, announced it would no longer defend its 2024 rule requiring public companies to disclose their climate-related risks, including greenhouse gas emissions.

• Rescinding ESG fund disclosure rules: In June 2025, the SEC withdrew 14 proposed rules from the prior administration, including those that would have required enhanced disclosures for Environmental, Social, and Governance (ESG) funds and strategies. 

Narrowing or raising reporting thresholds

The SEC can alter the criteria that determine which companies must disclose information, effectively exempting some from public reporting requirements.

• Changing rules for private companies: The SEC could change its rules for companies that qualify for exemptions from registration and disclosure requirements. Recent years have seen more companies stay private for longer, which has fueled debate over whether these exemptions still provide adequate investor protection.

• Raising disclosure thresholds for executive perks: The SEC could increase the dollar amount at which personal security expenses and other executive perks must be disclosed. Some companies argue the current threshold is too low and leads to unnecessary scrutiny. 

Reducing enforcement and oversight

The agency can limit transparency by scaling back the frequency and rigor of its oversight functions.

• Fewer disclosure reviews: Due to personnel cutbacks or internal changes, the agency may reduce the frequency of its reviews of company filings. A recent Inspector General's report raised concerns about the staff's ability to conduct these reviews, which are required for every company at least once every three years.

• Less oversight of alternative products: The SEC could roll back restrictions on more complex, less-regulated products in private markets. This could increase opportunities for investment managers but reduce investor protections.

• Less emphasis on specific details: The SEC could become less stringent about enforcement actions related to disclosure issues. For example, recent cases have drawn criticism for focusing on minor details rather than the overall picture, which critics say could lead to less meaningful disclosures if not consistently applied. 

Creating less stringent reporting frameworks

The SEC can adjust the guidelines that govern reporting, leading to less consistent or comprehensive disclosures.

• Changing rules for share repurchases: The SEC could modernize its rules for stock buybacks, possibly reducing the detail required for disclosure. A previous attempt to require daily repurchase data was vacated by a court.

• Permitting less detailed filings: In the past, some have suggested the SEC adopt page limitations on company filings to produce less verbose disclosures, which could reduce transparency around specific topics.

• Reducing Consolidated Audit Trail (CAT) functionality: The SEC recently granted conditional exceptive relief that allows for cost-saving measures by reducing the functionality of the Consolidated Audit Trail, which was designed to help track market activity. 

IN HUMAN NATURE, accepting a less restrictive practice (eliminating the quarterly report rule) in exchange for changing rules on a more important issue like transparency can lead to a trade-off between freedom and control, where people might prioritize the immediate benefit of greater personal freedom but risk eroding a foundational principle of openness and accountability over time. Such a circumstance is considered a bully tactic. Conversely, some may view the less restrictive practice as a positive step that enhances autonomy and participation, even at the cost of a higher degree of openness. 

Potential Negative Reactions of the Bully Tactic:

• Psychological Reactance: The perceived imposition of rules, even when offering less restriction, can lead to anger and a desire to oppose the change to reassert freedom. 

• Erosion of trust: A reduction in transparency can lead to a gradual loss of trust in those offering the compromise, as it implies a willingness to hide certain information. 

• Misplaced priorities: People might prioritize short-term freedom over the long-term benefits of transparency, potentially creating a slippery slope where more principles are compromised. 

• Manipulation: An offer of less restriction might be a deliberate tactic to obscure underlying issues or to gain control in a less obvious manner. 

Allowing the Bully Tactic to win on a small point often emboldens them, reinforcing the behavior and leading to further, often more aggressive, intimidation. Bullies are motivated by power and control, and each victory—no matter how small—validates their tactics and confirms that their victims are easy targets. 

How the Bully Tactic behavior escalates

• Encourages further intimidation: When you concede, you teach the bully that their actions are effective. Instead of a one-time issue, it becomes a tested strategy for them to get what they want.

• Validates their tactics: Bullies often lack empathy or remorse. Conceding gives them the satisfaction and emotional reward they crave from overpowering someone.

• Removes their fear of consequences: If a bully's behavior is met with a concession rather than consequences, they believe they can act with impunity. They may even escalate if they feel it is necessary to get the same thrill.

• Lowers the bar for future encounters: A bully who wins a small argument will expect future victories with even less effort. The goalposts for their demands will shift as they sense they can push further. 

The impact on the victim and others

• Erodes confidence and self-esteem: Each time a person gives in, it can chip away at their self-worth, making them feel weaker and more vulnerable. This can lead to a cycle of avoiding conflict and giving in.

• Signals to bystanders that bullying is acceptable: When others see a bully succeed, it can send a message that the behavior is tolerated. This bystander effect can enable the bully by creating a passive environment.

• Isolates the victim: Bullies can isolate their targets by eroding their social support system. People may withdraw from a victim to avoid becoming targets themselves.

• Leads to long-term trauma: Sustained bullying, even through a series of "small" wins, can inflict lasting psychological damage, leading to full control of your existence.  

TRANSPARENCY IS THE ONLY OPTION:

The reference "bullies are stopped with transparency" is not an official investment principle, but a rhetorical framing that likens deceptive or unethical financial practices to bullying. By promoting transparency—a cornerstone of ethical investing—investors can prevent exploitation and level the playing field, much like shining a light on a bully's behavior can disarm them.  Indeed, transparency fosters trust and enables informed decision-making by providing clear, accessible information about investments, risks, and costs.

We say, "the best information wins." Data transparency an innate drive to seek and share complex information and knowledge, fostering social cohesion and cooperation. In the modern world, this manifests as a craving for information, which serves several psychological needs: 

• Reduces uncertainty: Access to clear information helps reduce anxiety and improves confidence in decision-making.

• Builds trust: For both individuals and organizations, consistent transparency and honest communication are critical for building and maintaining trust.

• Empowers individuals: When people are given transparent data, they feel more in control and are empowered to make informed decisions that align with their own values.

• Connects to others: The desire to self-disclose and connect with others is a fundamental human motive, engaging neural reward mechanisms. 

Working in unison, these factors are critical to take control of your own destiny.

Are you willing to lose control of your financial destiny?

... As for ENDING QUARTERLY EARNING REPORTS CONTRIBUTES TO FINANCIAL INSTABILITY will materially contribute to losing control of your financial destiny