Commentary

Wednesday, November 30, 2016

Enlightened, not Reactive Regulation: Now It Starts

Author: David Schwartz J.D. CPA
Since passage of the Dodd-Frank Act in 2010, the financial industry has been dealing with an almost unstoppable wave of regulatory reforms. Most, if not all have been designed to prevent a repetition of the problems that followed the failure of AIG and Lehman Brothers in 2008. Now, after the U.S. election of a conservative majority in two (and soon to be all three) branches of the U.S. federal government, many bankers feel that a huge regulatory weight is about to be lifted. Some bankers...
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Tuesday, September 6, 2016

Surprise! Market Theories Fail in Real-World Tests!!

Single-vector studies miss the full picture

Author: Ed Blount

“There is nothing less practical than a bad theory,” wrote CEO Paul Shott Stevens of the Investment Company Institute (ICI) in a July 2016 blog.  Mr. Schott introduced a series of recent findings that the ICI suggests may present a rebuttal to their members of the “first-mover” hypothesis. What is that, one may ask, and why should I care?

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Sunday, July 10, 2016

Dealer-based Execution on Trial

Always Worse than Exchange Pricing?

Author: Ed Blount
Is it true that customers always get a better price for their trades when executions take place on a regulated exchange? That seems to be the premise underlying a putative class action suit filed in federal court last November in the Southern District of New York. Next week, on July 19th, the court and litigants will be developing the pretrial schedule, including discovery and deadlines for naming experts, in what may well be a landmark case for competition in financial services. 
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Tuesday, April 19, 2016

More Challenges for Fund Directors in the New Regulatory Environment

Author: David Schwartz J.D. CPA

Securities and Exchange Commission Chair Mary Jo White’s March 29 speech to the Mutual Fund Directors’ Forum can be seen as a showcase of the philosophical differences between market regulators and banking supervisors. For directors, the speech also reveals the sometimes conflicting results of the compliance forces created by these two complementary regulatory systems.

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Saturday, February 20, 2016

Global Financial Reform: Unintended Adverse Consequences in Connected Markets

Author: David Schwartz J.D. CPA

Financial markets in the 21st Century are profoundly global.  This fact was amply demonstrated by the 2007 – 2009 financial crisis, which was centered in the banking systems of the developed western economies but transmitted with devastating effect to economies worldwide. And yet, despite the global consequences of systemic risk transmission, the supervision of financial markets remains essentially a national discipline.  

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Journal Commentaries

 

Keep Regulation Functional (October 2008)

CSFME’s Executive Director Ed Blount interviews SEC Chairman Chris Cox.
American Banking Association Banking Journal
https://www.questia.com/library/journal/1G1-187494664/keep-functional-regulation-how-financial-regulation

 

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

by Ed Blount
The RMA Journal, v91n1, 28-32, 5 pages Sep 2008.

 

Searching for New Paradigms at BIS (July 2008)

by Ed Blount
Unexpected deficiencies in bank capital after recent market turmoil has regulators rethinking aspects of Basel II and “value at risk.”  
American Banking Association Banking Journal  
https://www.questia.com/library/journal/1G1-181991450/searching-for-new-paradigms-at-bis-market-turmoil

 

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

By Ed Blount
Newly elected Basel Committee Chairman Caruana, Governor of the Bank of Spain, gives his views on the revised Basel capital accord, relative to its potential effects on competition and risk management in banking markets.
American Banking Association Banking Journal
https://www.questia.com/read/1G1-108008773/will-basel-ii-affect-the-competitive-landscape-the​