Week InReview | Bond trader lies: collusion, deception, bond parking... oh my!! | BOE to review activities of non-bank financial sector | IOSCO says CDS post-trade transparency is 'valuable' | OFR & Cleveland Fed call for research & policy-oriented papers | Binge Reading Disorder
Friday, August 14, 2015
Bond trader lies
Collusion, deception, bond parking... oh my!!
(Aug 13) The review of how traders market debt securities to asset managers comes as the government takes a broad look at possible malfeasance tied to bonds. For the SEC, which has faced lawmaker criticism that it has failed to punish individuals over the 2008 financial crisis, the bond probes are a top priority. Helping drive the SEC's investigations is proprietary software that's allowing the agency to cull through reams of data and spot suspicious transactions. The agency has also used its software to track what's known as parking, where one trader agrees to sell a bond to another firm with the assumption that it will be bought back at a higher price.
Non-bank financial sector
BOE to review activities
(Aug 11) The Bank of England's Financial Policy Committee will review the activities of and risks from non-banks including open-ended investment funds and hedge funds, Governor Mark Carney said in a letter to Chancellor George Osborne.
  • Securities financing transactions, non-traditional, non-insurance and investment activities of insurance companies and derivative transactions also to be reviewed
  • FPC to consider recommendations to Treasury if risks or vulnerabilities are found that current framework doesn't deal with
  • FPC will discuss report on market liquidity commissioned in March at its September meeting
CDS post-trade transparency
IOSCO says it's 'valuable'
(Aug 10) Making public the price and size of credit default swaps trades after the transaction has happened would help market participants and observers, the International Organization of Securities Commissions says.
  • Report considers impact of mandatory post-trade transparency
  • Data doesn't suggest mandatory post-trade information sharing has 'substantial impact' on risk exposure or activity: report
  • IOSCO encourages member nations to enhance post-trade transparency in CDS market
Call for research & policy-oriented papers
Invite from OFR and Cleveland Fed
(Aug 11)  The Office of Financial Research and the Federal Reserve Bank of Cleveland are inviting the submission of research and policy-oriented papers for their 2015 Financial Stability Conference December 3-4, 2015, in Washington, D.C. This conference will concentrate on data requirements for macroprudential policy development and implementation, and recent advances in systemic risk measurement and forecasting tools.
Binge reading disorder
Hand-curated, chosen with love
  • "Hell is Empty and All the Devils Are Here": A Shakespearean guide to the Republican primaries (McSweeney's)
  • Billy Beane on Making Better Decisions, Challenging Entrenched Thinking, and Avoiding Biases (Farnam Street)
  • Where's the Evidence? (Evidence Investor)
  • And the New Yorker Cartoon Contest Winner Is ... a Computer (Bloomberg)
  • Security Tool Tricks Workers Into Spilling Company Secrets (Wired)