Brookings-Wharton Papers on Financial Services : 1998

by Santomero, Anthony M.

• ISBN13: 9780815711858
• ISBN10: 0815711859
• Format: Paperback
• Copyright: 1998-07-01
• Publisher: Brookings Inst Pr

Summary

Just 10 years ago, in October 1987, the stock market suffered its deepest short-term plunge since the Great Depression, a searing event for investors. This first in a series of annual volumes on the financial services industry from the Brookings Institution and the Wharton School at the University of Pennsylvania examines the '87 crash and its aftermath.The papers in this inaugural volume, as well as brief comments on the papers, are written by some of the leading financial experts from the corporate, government, and academic communities in the United States. Future volumes will address other important issues affecting the financial services industry and thus continue to be a source of invaluable analysis and information for participants in the industry, financial regulators, policymakers, and everyone concerned with financial services.Contents of this issue include:"The Crash, the Exposed Problems, and the Remedies" by Nicholas Brady, Former Secretary of the Treasury; E. Gerald Corrigan, Former President, New York Federal Reserve Bank; and Leo Melamed, Chairman Emeritus, Chicago Mercantile Exchange"Circuit Breakers and Program Trading Limits: What Have We Learned?" by Lawrence Harris, University of Southern California"Trends in Volatility" by G. William Schwert, University of Rochester"Advances in Clearing and Settlement" by David B. Humphrey, Florida State University"New Instruments: Added Risk or Risk Management" by Stephen Figlewski, New York University"Has the Rise of Mutual Funds Increased Market Instability?" by Vincent A. Warther, University of Michigan"Internationalization of Markets: How Has It Affected Stability?" by Ingrid M. Werner, Stanford University, and Linda L. Tesar, University of Michigan"Challenges Posed by Systemic Risk in a Global Financial Marketplace: Views from the Regulators" by Philip F. Bartholomew, Office of the Comptroller of the Currency; Jonathan R. Macey, Cornell Law School; and Erik R. Sirri, Securities and Exchange Commission

Table of Contents

Preface	ix	(2)
Editors' Summary	xi
The Crash, the Problems Exposed, and the Remedies	1	(16)
NICHOLAS F. BRADY
Comments and Discussion	5	(12)
Circuit Breakers and Program Trading Limits: The Lessons Learned	17	(48)
LAWRENCE E. HARRIS
Comments and Discussion	48	(17)
Stock Market Volatility: Ten Years after the Crash	65	(50)
G. WILLIAM SCHWERT
Comments and Discussion	100	(15)
Advances in Financial Market Clearing and Settlement	115	(44)
DAVID B. HUMPHREY
Comment and Discussion	143	(16)
Derivatives Risks, Old and New	159	(80)
STEPHEN FIGLEWSKI
Comments and Discussion	219	(20)
Has the Rise of Mutual Funds Increased Market Instability?	239	(42)
VINCENT A. WARTHER
Comments and Discussion	263	(18)
The Internationalization of Securities Markets since the 1987 Crash	281	(92)
LINDA L. TESAR
INGRID M. WERNER
Comments and Discussion	350	(23)
Banking Consolidation and Systemic Risk	373	(32)
PHILIP F. BARTHOLOMEW
Regulation and Disaster: Some Observations in the Context of Systemic Risk	405
JONATHAN R. MACEY
Comment and Discussion	428