by Simon St. Laurent

Related link: http://www.theregister.co.uk/content/7/28661.html

I don't get to say very nice things about my New York State elected officials very often. New York government is a marvel of dictatorial gridlock, with three people making most of the decisions, if and when they can get along, which is rarely.

On the bright side, and separate from that triumvirate, New York's Attorney General has a lot of power relative to other AGs. At the moment New York is blessed with an Attorney General who's willing to use that power to clean up one of New York's most important (and powerful) businesses, financial services. If we're lucky, he may help build a foundation that will keep business from sullying the good name (well, sort of) of technology.

Spitzer's latest victory offers a chance to rebuild the relationships between technology (cool stuff that lets us get things done) and business (let's make some money). The strange behavior of analysts in the recent dot-com boom helped build fortunes, then wreck them as the reality underneath surfaced. "Irrational exuberance" may have affected the markets, especially around anything to do with technology, but there were plenty of people and companies happy to fuel that exuberance for their own benefit.

The settlement both strikes a blow at the old coziness between analysts and investment bankers and sets the stage for analysis that will hopefully peer deeper under the covers than was popular when everything was on its way up. If technology companies want money from the markets, they need to establish a lot of trust. Independent analysis of their prospects offers a better route to establishing that trust than the previous system.

Spitzer's own statements are fascinating, exploring both the disconnect between predictions and results and the need for better-grounded predictions. Spitzer's dream is pretty simple:

"My response to them is simple: if you don't want to stand behind your recommendations, don't make them available to retail investors. But recognize the potential benefits of transparency: once there are performance based measurements made publically available, there can be no doubt that banks will compete for -- and generously compensate -- proven stock-picking talent."

While technologists often tout the benefits of encapsulation, business needs transparency. Making the technology-business relationship fruitful takes more than counting on an invisible hand - as Andrew Orlowski points out at The Register, that hand may be otherwise occupied.

It's nice to see New York leading the nation, and a politician I voted for making a difference.

(Excelsior is the state motto for New York, meaning "ever upward", and appears on the state flag.)

Does trust matter as technology moves forward?