Thursday, April 28, 2022

Regulators Drop the Hammer on Archegos

Rogue Trader's Behavior Yields Lessons for Risk Management

Author: David Schwartz J.D. CPA

The Securities and Exchange Commission (SEC) filed a civil lawsuit against Archegos Capital Management, its founder, and several other individuals in April 2022. The SEC alleges that Archegos engaged in a fraudulent scheme to manipulate the market for the securities of the issuers that represented Archegos's top 10 holdings, both through purchases of the issuers' securities and entry into total return swaps referencing those issuers. This event has led investment firms on both the...

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Categories: All, Change Overview and Rationale, Cross-Post

Tags: Derivatives, Counterparty

Thursday, March 3, 2022

Disclosure and Beyond: Restructuring the U.S. Equity Markets

BRIEFING GUIDE to the SEC's Aggressive Agenda to Head off the Next "Big Squeeze"

Author: David Schwartz J.D. CPA

On Friday, February 25, 2022, the Securities and Exchange Commission (SEC) proposed its latest round of GameStop rule proposals. In addition to enhanced public disclosures of short sales by institutional investors, the Commission announced a 30-day extension of the comment period on its sweeping securities lending disclosure proposal, Rule 10c-1, and technical amendments to the "consolidated audit tape" regulations. These separate, but related, disclosure proposals may well be...

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Categories: All, Change Overview and Rationale, Formal Regulatory Remedies, Cross-Post

Tags: securities lending, short selling, SEC, T+1

Tuesday, February 15, 2022

T+1: The Future is Now (or at least as early as 2024)

The SEC Boldly Sets Course for T+1 and T+0

Author: David Schwartz J.D. CPA

While real-time settlement is still something that may happen far in the future, perhaps on the Starship Enterprise, T+1 is now imminent. On February 9, 2022, the Securities and Exchange Commission proposed to make T+1 a reality. The proposal aimed at reducing risks in clearance and settlement seeks comment on shortening the current T+2 standard settlement cycle for most broker-dealer transactions by one day to T+1. Notably, the proposal also makes clear that T+0 is the ultimate and eventual...

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Categories: All, Change Overview and Rationale, Formal Regulatory Remedies, Cross-Post

Tags: swaps clearing, Risk Management, SEC, T+1

Friday, February 11, 2022

How Would Cross-Border Payments Change in a Digital Currency World?

World Bank, BIS and SWIFT weigh in on CBDCs

Author: David Schwartz J.D. CPA

Widespread adoption of central bank digital currencies (CBDC) could revolutionize cross-border payments by reducing friction and making it possible for T+1 or even T+0 settlement of cross-border trades. The Fed’s Digital Currency discussion paper is the central bank’s first step in a public discussion with stakeholders about a digital dollar, as we described in our January 25 post. But what would such a cross-border payment system look like? Is it enough to mimic the traditional...

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Categories: All, Change Overview and Rationale, Cross-Post

Tags: Financial Innovation, CBDC

Tuesday, January 25, 2022

The Fed Weighs in on a 'Digital Dollar'

Vast Cross-border Implications for Central Bank Digital Currencies

Author: David Schwartz J.D. CPA

A discussion paper published on January 20^th invites the public to explore with the U.S. Federal Reserve Board the creation of a digital version of the U.S. dollar. A Central Bank Digital Currency (CBDC) backed by the Federal Reserve would be designed, according to the Fed’s paper, to compete with cryptocurrencies like Bitcoin and Ethereum. Comments are due by May 20, 2022.

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Number of views (2874)

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Categories: All, Change Overview and Rationale, Cross-Post

Tags: cross-border

Commentary

Regulators Drop the Hammer on Archegos

Rogue Trader's Behavior Yields Lessons for Risk Management

Disclosure and Beyond: Restructuring the U.S. Equity Markets

BRIEFING GUIDE to the SEC's Aggressive Agenda to Head off the Next "Big Squeeze"

T+1: The Future is Now (or at least as early as 2024)

The SEC Boldly Sets Course for T+1 and T+0

How Would Cross-Border Payments Change in a Digital Currency World?

World Bank, BIS and SWIFT weigh in on CBDCs

The Fed Weighs in on a 'Digital Dollar'

Vast Cross-border Implications for Central Bank Digital Currencies

Journal Commentaries

Keep Regulation Functional (October 2008)

The Bear Market Posse, or Counterparty Risk Management during the Recent Turmoil (Sept. 2008)

Searching for New Paradigms at BIS (July 2008)

Will Basel II Affect The Competitive Landscape? (September 2003)