In the bull market that has suddenly broken out for stocks, you might have missed the bull market emerging in another commodity: regulatory irony.

The likely outcome will be wide access to formerly exclusive securities—and a greater risk of fraud and abuse.

On Aug. 29, the Securities and Exchange Commission proposed a rule permitting issuers to promote private offerings to the general investing public for the first time.

The very next day, the SEC issued a report on financial literacy, which concluded—and I paraphrase here, but not by much—that members of the general investing public can barely tie their own shoes.

So what led the nation’s leading financial regulator into this absurd contradiction? Congress, of course.

Under the Dodd-Frank financial-overhaul law of 2010 and the JOBS Act of 2012, Congress required the SEC to study how knowledgeable the investing public is and, at the same time, to allow companies to market their private securities to anyone they care to pitch to.

The end result: rules that make some of the biggest changes to the investment world in more than a quarter of a century.

http://online.wsj.com/article/SB10000872396390443589304577637790108826970.html