Forget the misleading subtitle. To Mayer (Whatever Happened to Madison Avenue, 1991, etc.), virtually all members of the US financial community have, by pursuing their own selfish interests, undermined the public purpose of securities markets--i.e., to provide reliable price information necessary to allocate the domestic economy's resources. Worse yet, Mayer charges, cops on the Wall Street beat are responding to opportunists' depredations with winks or nods. In a savvy, wide-ranging overview longer on anecdotal than statistical evidence, Mayer warns that the open, honest, and liquid markets that have contributed so greatly to American prosperity face grave dangers. With a big assist from advances in data-processing and telecommunications technology, for example, institutional investors are, he says, doing business among themselves, filling orders at prices that need not be disclosed. And with less than one fifth of their income nov accruing from commissions, according to the author, brokerage houses apparently are on the game as well, trading for their own accounts--and frequently using inside information about client plans and strategies. In the meantime, Mayer cautions, the development of so-called derivative instruments (notably, options on stock indexes) and the trend to passive management of portfolios designed to mirror the performance of popular market averages have greatly increased the risks of manipulation. At best, the author argues, federal regulatory authorities have been complacent witnesses to these unfortunate events. Among other sins of commission, he cites the SEC's decision to let major institutions traffic in privately placed as well as publicly offered securities. Not surprisingly, Mayer offers a short list of needed reforms. He proposes full disclosure for all transactions involving equity in American enterprises, plus confiscatory taxes to discourage short-term trading by investment professionals. Mayer would also impose levies to create friction between futures and exchange markets that currently tend to move in lockstep. A timely and thoughtful alert on a socioeconomic problem whose implications are (or should be) of general concern.