Wall Street Journal (December 22)
“How is it that a derivatives trading platform younger than Justin Bieber is about to acquire the New York Stock Exchange, which traces its Wall Street lineage to 1792? Thursday’s announcement that Intercontinental Exchange (ICE) will buy NYSE Euronext for about $8 billion is in part the story of a tech-savvy upstart that quickly grew to eclipse established giants.”
Tags: Acquisition, Derivatives, Ice, NYSE, Technology, Wall Street
Securities Technology Monitor (August 6)
High frequency trading “can wreak havoc in the global financial marketplace by amplifying moves on the up- and down-sides.” The “Knightmare on Wall Street” focused attention on this issue when a software glitch at Knight Capital caused almost 40 NYSE-listed stocks to move more than 10% in less than 60 minutes. “The problem with the rising popularity of High-Frequency Trading is that it may be distorting global financial markets significantly, increasingly destabilising those markets and causing the rise of systemic risk.”
High frequency trading “can wreak havoc in the global financial marketplace by amplifying moves on the up- and down-sides.” The “Knightmare on Wall Street” focused attention on this issue when a software glitch at Knight Capital caused almost 40 NYSE-listed stocks to move more than 10% in less than 60 minutes. “The problem with the rising popularity of High-Frequency Trading is that it may be distorting global financial markets significantly, increasingly destabilising those markets and causing the rise of systemic risk.”
Forbes (August 6)
“Call it the best disaster and recovery Wall Street has seen in a long time. In less than a week, Knight Capital screwed up royally to the point of near failure and then managed to save itself with the help of outside investors…. If a financial institution is going to mess up then this is the way to do it—without hurting clients and without getting taxpayers involved.”
“Call it the best disaster and recovery Wall Street has seen in a long time. In less than a week, Knight Capital screwed up royally to the point of near failure and then managed to save itself with the help of outside investors…. If a financial institution is going to mess up then this is the way to do it—without hurting clients and without getting taxpayers involved.”
Tags: Clients, Investors, Knight Capital, Taxpayers, Wall Street
Wall Street Journal (October 3)
Hundreds of protestors were arrested for blocking traffic on the Brooklyn Bridge as “the anti-Wall Street protest in Lower Manhattan entered its third week.” The protest has spawned similar protests in cities including Chicago and Los Angeles. Most of the protestors complaints are directed at “corporations that they say are too powerful and often unethical,” with firms that received taxpayer bailouts while still awarding bonuses singled out for extra scorn.
Hundreds of protestors were arrested for blocking traffic on the Brooklyn Bridge as “the anti-Wall Street protest in Lower Manhattan entered its third week.” The protest has spawned similar protests in cities including Chicago and Los Angeles. Most of the protestors complaints are directed at “corporations that they say are too powerful and often unethical,” with firms that received taxpayer bailouts while still awarding bonuses singled out for extra scorn.
Tags: Brooklyn Bridge, Chicago, LA, New York, Protest, U.S., Wall Street
Financial Times (July 20)
Dodd-Frank was supposed to be the biggest regulatory overhaul since the Great Depression. One year later, Dodd-Frank’s not living up to its billing. “Plenty of economists, officials and congressional aides think …the reforms have not shaken up Wall Street enough.” Of the 400 required rules, only 55 have been finalized and of 87 required studies, only 32 have been completed. Limited staff have been slowing the process, but so are concerns that the regulations are unneeded and risk slowing a still weak economy. Some are saying that it will take another major crisis to create momentum for real reform.
Tags: Crisis, Dodd-Frank, Economy, Regulation, U.S., Wall Street
New York Times (February 22)
Mayor Bloomberg has proposed a budget for New York City which cuts 6,000 teachers, 20 fire stations, 100 senior centers, 8% of library funding, 11% of the parks and recreation budget, and 17,000 child-care options for low-income working parents. The proposed $65.6 billion budget is “less painful than expected,” largely due to the unexpectedly rapid recovery of Wall Street. “The city looks in better shape than we expected, even a few weeks ago.”
Tags: Budget cuts, New York, Wall Street
Financial Times (July 30)
Columnist John Gapper notes that three years ago the British banking system started rumbling with worries over Northern Rock. Then two years ago, “Wall Street went into spasm.” What’s changed since the banking crisis? Not much. Rather than coordinated international measures, “the reforms are not only inconsistent but–particularly in the case of the BIS [the Bank for International Settlements, which delayed implementation of stricter liquidity rules for eight years]–have a lowest common denominator feel.” As a result, bankers can enjoy their summer holidays, but “the rest of us cannot relax so easily.”
Tags: Bank reform, Northern Rock, Wall Street
New York Times (May 2)
Lashing out at Wall Street Banks is now an American pastime, but the credit ratings agencies “bear as much responsibility for the financial crisis as the banks.” Largely forgotten is the role Moody’s, S&P and Fitch played. Investors and financial institutions would never have purchased as many mortgage-backed securities and collateralized debt obligations (CDO’s) had the raters properly warned investors that these were essentially “high-tech junk bonds,” rather than triple-A securities. Current proposals aimed at reforming the ratings agencies are not enough. The newspaper supports drastic steps to improve the ratings system.
Lashing out at Wall Street Banks is now an American pastime, but the credit ratings agencies “bear as much responsibility for the financial crisis as the banks.”
Largely forgotten is the role Moody’s, S&P and Fitch played. Investors and financial institutions would never have purchased as many mortgage-backed securities and collateralized debt obligations (CDO’s) had the raters properly warned investors that these were essentially “high-tech junk bonds,” rather than triple-A securities. Current proposals aimed at reforming the ratings agencies are not enough. The newspaper supports drastic steps to improve the ratings system.
Tags: Banks, CDOs, Fitch, MBS, Moody's, NRSROs, Ratings agencies, S&P, U.S., Wall Street
