Thursday, July 31st, 2008
Last week I had a fascinating conversation with a friend of mine who is an anarchist. We tend to discuss international capitalism and he always wants to convince me that it is possible to create a society without capitalism. When I asked him about what that would mean he ...
Posted in Books | 7 Comments »
Thursday, May 8th, 2008
Glyn Holton wrote an article about how to detect fraud in the reports by Hedge Funds: using Benford's Law.
Benford's law, also called the first-digit law, states that in lists of numbers from many real-life sources of data, the leading digit is 1 almost one third of the time, and larger ...
Posted in General | No Comments »
Tuesday, May 6th, 2008
How to define pro-cyclicality
Procyclicality is used in the context of discussing the effects of Basel II on the financial system. A simplified definition of pro-cyclicality is:
International rules have encouraged banks to act more aggressively when the economic cycle is in the middle of an upswing, when some argue that is ...
Posted in Discussions | 1 Comment »
Wednesday, April 30th, 2008
In most fields of regulation, even on the national level, organisation representing private interests or corporations have a saying. Private interestes are expressed through lobbyism and public relation activities, but the governance system in most states is characterized by representatives from the relevant industries having their say in standard-setting and ...
Posted in Memo | No Comments »
Tuesday, April 22nd, 2008
Dirk Schoenmaker and Sander Osterloo from the Dutch Finance Ministry have written an article about Cross-border issues in European financial supervision as part of the book on the Structure of Financial Regulation by David G Mayes and Geoffrey E Wood.
At the beginning of their article, they point to the fundamental ...
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Tuesday, April 22nd, 2008
Charles Goodhart has written an article called "Financial supervision from an historical perspective" in a book about the "Structure of Financial Regulation" by David Mayed and Geoffrey E Wood.
He mostly focuses on the role of the Central Bank in the financial system, and in particular about how the Bank of ...
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Tuesday, April 22nd, 2008
David G. Mayes and Geoffrey E. Wood have published a book about "The Structure of Financial Regulation" in 2007 based on a workshop held at the Bank of FInland. The book includes some interesting chapters on:
Financial supervision
Bank regulation and money laundering
Corporate Governance
Insolvency Regimes
Financial stability and the EMU
Cross-Border Payment Systems
Securities clearing ...
Posted in Books | 2 Comments »
Tuesday, April 22nd, 2008
Puzzling Complexity
The global financial architecture is very complex. Despite increasing liberalization of financial markets, increased system risk and integration of the economies through the financial markets in the last 30 years, there is no single World Financial Authority regulating the financial markets, as Alexander, Eatwell and Dhumale have suggested.
Instead what ...
Posted in Memo | No Comments »
Sunday, April 20th, 2008
When academics, analysts and scholars analyze the causes and remedies for the current credit crisis, most of them analyze macro-economic trends such as exchange rate movements, or micro-economic changes such as Basel II.
How the global financial architecture evolved and how that influences the probability of crisis is very rarely discussed. ...
Posted in Memo | No Comments »
Thursday, April 17th, 2008
To speak about systemic risks only makes sense when analyzing a large system, such as the international financial markets. The financial markets are the quintessential traders of risk, because risks from investments, macro- and micro-economic policy, technological innovation and behaviour of market participants is constantly assessed and priced.
The existence of ...
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