SEC proposes the use of Python and XML

[Patrick Maupin]

On Apr 11, 3:12 am, Cameron Simpson <c... at zip.com.au> wrote:
> On 10Apr2010 23:05, Chris Rebert <c... at rebertia.com> wrote:
> | On Sat, Apr 10, 2010 at 9:13 PM, Ted Larson Freeman| <free... at alumni.stanford.org> wrote:
>
> | > This week the SEC proposed new requirements for asset-backed
> | > securities that include the use of XML and Python:
> | >
> | > "The asset-level information would be provided according to proposed
> | > standards and in a tagged data format using eXtensible Markup Language
> | > (XML). In addition, we are proposing to require, along with the
> | > prospectus filing, the filing of a computer program of the contractual
> | > cash flow provisions expressed as downloadable source code in Python,
> | > a commonly used open source interpretive programming language."
> |
> | I guess we've now gone from "executable pseudocode" to "executable
> | legal code" :-)
>
> And not before time, either :-(
>
> But unless they require it to be usable as unit tests (eg running as
> validation of a live transaction stream, or in some audit mode) it may be
> less useful than one might hope. Of course, if they're gone as far as
> requiring python code, perhaps that's exactly what they hope to be able to
> do.
>
> Cheers,
> --
> Cameron Simpson <c... at zip.com.au> DoD#743http://www.cskk.ezoshosting.com/cs/
>
> One of the guys in my homebrew club is a mailman. He says that one of the
> requirements to work for the post office is to be able to work the slide on a
> 9mm while laughing.     - Phillip J. Birmingham

I would think there are two major reasons for this:

1) less wiggle room for the lawyers to argue about the terms of the
contract.

2) it makes it easier for parties to the contract to assess their
risks under different scenarios by plugging all their contracts into a
single model.

I don't know the SEC needs to define standards for unit-tests, etc.
-- that might happen organically, because these are all big companies
with their own in-house programming staffs.  Getting the programmers
involved before a contract is signed is a great thing.

Once the lawyers are told "the program defines the contract" you can
bet both sides are going to check out the program pretty carefully,
and if a programmer says "hey, when this thing happens in the economy,
we owe them 5 times the GDP of the planet", the contract probably
won't happen.

Regards,
Pat