Friday, October 30, 2015

Let's recap

In case you missed it . . .

(Oct 27) Inside the Secretive Circle That Rules a $14 Trillion Market

Fifteen of the biggest players in the $14 trillion market for credit insurance are also the referees. Firms such as JPMorgan Chase & Co. and Goldman Sachs Group Inc. wrote the rules, are the dominant buyers and sellers and, ultimately, help decide winners and losers. Once the 15 firms decide that a default has taken place, they effectively determine how much money will change hands.

(Oct 27) IOSCO Shines a Spotlight on the Bond-Market Liquidity Debate

It has been been one of the most hotly contested issues across Wall Street with some of the biggest names in finance lining up on opposite sides of the debate: Has bond-market liquidity deteriorated since the financial crisis? Now a group of global securities regulators is trying to settle the debate or at least hear what the financial community has to say about it.

(Oct 27) SEC To Vote On Title III Equity Crowdfunding Rulings October 30th

After more than three years of delays, the Securities and Exchange Commission will vote to finalize rules on Title III of the JOBS Act in a public meeting on Friday, October 30th. There are currently two crowdfunding related laws startups and small businesses may utilize today, with Title II accredited crowdfunding and Title IV Reg A+ with non-accredited investors.

(Oct 27) "Tectonic Shifts": Biggest Tests for Market Liquidity Yet to Come

The biggest tests for already weakened market liquidity may lie ahead amid "tectonic shifts" in money flow, though the Bank of England would intervene if volatility threatened financial stability, BoE Deputy Governor Minouche Shafik, said. Shafik said bouts of extreme volatility in Chinese shares, U.S. Treasuries and Swiss franc raised concerns among central bankers that markets could be destabilized if selling became prolonged.

(Oct 23) How MiFID II Will Impact the Anatomy of the Investment Process / Trade Life Cycle

As we began to work our way through ESMA's MiFID II implementation standards, we started to formulate a framework for understanding how aspects of the regulation are going to affect the investment life cycle on the buy side. Structuring this regulation is extremely important because at 585 pages for the regulatory technical and implementing standards alone (Annex I), MiFID II is an expansive document - and more is coming. At the end of November, ESMA will provide additional insight into the use of dealing commission, fixed income research and other areas.

Regulatory arbitrage in repo markets

OFR working paper

(Oct 29) The Office of Financial Research released a working paper entitled, "Regulatory Arbitrage in Repo Markets," and an accompanying blog by Greg Feldberg, OFR Acting Deputy Director for Research and Analysis. The paper documents a pattern of broker-dealers owned by foreign banks reducing their borrowing in the U.S. triparty repo market, a key source of short-term funding in the financial system, at quarter end and immediately returning to the market when a new quarter begins. This activity reduces their capital requirements under the leverage ratio.

SEC CorpFin initiatives

Timelines come into focus

(Oct 29) Officials from the Securities and Exchange Commission's Division of Corporation Finance gave progress updates on a few division priorities, including universal proxy ballots, disclosure effectiveness review and its consideration of the "accredited investor" definition. The accredited investor review will be finished in the "quite near future," and some results of Regulation S-X review, including coordination with the Financial Accounting Standards Board, will likely begin in the first half of 2016, Keith Higgins, the division director, said on a panel at a Practising Law Institute seminar in New York. On the same panel, division official Michele Anderson said rules on universal proxy ballots won't be adopted for the 2016 proxy season, although further details on the exact timing are still unclear.

Global data chiefs recommit to building bridges

EU-U.S. framework a blueprint for other continents

(Oct 29) Data protection authorities from around the world concluded the 37th International Conference of Data Protection and Privacy Commissioners in Amsterdam by pledging to continue work on a series of 10 privacy bridges intended to promote a global common understanding of critical data privacy issues. Recommendations for joint work by data protection authorities and lawmakers, was proposed by a group led by the University of Amsterdam and the Massachusetts Institute of Technology Internet Policy Research Initiative. The privacy bridges deal with issues of regulatory cooperation, privacy governance and research and are intended to address emerging issues that all jurisdictions will have to face.

Binge reading disorder

Hand-curated, chosen with love

The dogs of Wall Street: where America's power-pups eat, play and poop (The Street)

If you CC this robot, it will schedule meetings for you (Fast Company)

Odd hedge funds and rogue traders (Bloomerg View)

The sounds-good-in-theory-portfolio (A Wealth of Common Sense)

Reinventing the company: entrepreneurs are redesigning the basic building block of capitalism (The Economiist)

Transparency.

Inclusiveness.

Consensus.