JPMorgan Chase London Whale G: Hedging versus Proprietary Trading

2014 ◽  
Author(s):  
Arwin G Zeissler ◽  
Andrew Metrick
Keyword(s):  
Proprietary Trading

Ring Fencing Volcker's Rule?

2017 ◽  
pp. 277-284
Author(s):  
Marianne Ojo
Keyword(s):  
Cost Effective ◽  
Effective Option ◽  
Proprietary Trading ◽  
Liikanen Report ◽  
Financial Environment ◽  
Legal Entities

This chapter is aimed at highlighting why ring fencing not only presents a more feasible and cost effective option to other models, but also why its degree of flexibility provides the more appropriate balance in a financial environment whose trend is increasingly inclined towards conglomeration. Whilst the Liikanen Report highlights why there is need for re-structuring of banks into separate legal entities – as a means of achieving ring fencing activities, the mandatory separation of banks' proprietary trading and other risky activities, such as that opted for under the Liikanen Report could be distinguished from the position under Volcker's Rule in the sense that it does not impose such stringent requirements as those applicable under Volcker's Rule – whilst not being as flexible as ring fencing recommendations proposed in the Vickers Report.

Laws and Regulations on Proprietary Trading System (PTS) in Japan

2009 ◽  
pp. 1289-1308
Author(s):  
Motoaki Tazawa
Keyword(s):  
United States ◽  
Information Technologies ◽  
The United States ◽  
Stock Exchanges ◽  
Trading System ◽  
Electronic Communications ◽  
Trading Systems ◽  
Proprietary Trading ◽  
Securities Business ◽  
The U.S

In order to improve convenience for investors through competition among stock exchanges, operation of Proprietary Trading Systems (PTS) was authorized as a form of securities business under the Securities and Exchange Act. The Japanese PTS is equivalent to ATS (Alternative Trading System), ECN (Electronic Communications Network) in the United States and MTF (Multilateral Trading Facilities) under MiFID in the EU. In 1998, ATS and ECN had already started in the United States and Japan’s PTS followed the U.S. model. Telecommunication and information technologies and computer technologies made PTS possible, and PTS makes the border between the market and brokers ambiguous. Traditional regulations on broker-dealers and stock exchanges will inevitably be reviewed and regulations on securities markets will have to be reformed.

Proprietary trading losses in banks: do banks invest sufficiently in control?

2006 ◽  
Vol 3 (3) ◽  
pp. 329-350
Author(s):  
Norvald Instefjord ◽  
Kouji Sasaki
Keyword(s):  
Proprietary Trading

scholarly journals Is Proprietary Trading Detrimental to Retail Investors?

2011 ◽  
Author(s):  
Falko Fecht ◽  
Andreas Hackethal ◽  
Yigitcan Karabulut
Keyword(s):  
Retail Investors ◽  
Proprietary Trading

Trennbankensystem – ein Weg zu mehr Finanzstabilität in Deutschland?

2014 ◽  
Vol 15 (1) ◽  
pp. 41-55 ◽  
Author(s):  
Andreas Dombret ◽  
Thilo Liebig ◽  
Ingrid Stein
Keyword(s):  
Significant Role ◽  
Financial Stability ◽  
Banking System ◽  
Real Economy ◽  
The Real ◽  
Considerable Fraction ◽  
The Us ◽  
Proprietary Trading ◽  
Systemically Important Banks ◽  
The Eu

AbstractThis article examines how the introduction of a specialised banking system is likely to impact banks and the real economy in Germany, in particular from a financial stability perspective. This study is motivated by a recently passed law in Germany on a specialised banking system (Trennbankengesetz), current reforms in the US and UK and proposals for the EU. We focus on the consequences of a separation of the savings & loan business and proprietary trading. We conclude that proprietary trading plays a significant role only for large, systemically important banks in Germany. The latter act as universal banks and grant a considerable fraction of all loans that go to domestic enterprises and consumers. Costs for customers, however, are likely to be moderate. In contrast, a specialised banking system may provide the important advantage that insolvent trading units can be separated more easily from the savings & loan business arm and eventually liquidated. In this way, implicit state guarantees may be reduced.

scholarly journals Is Proprietary Trading Detrimental to Retail Investors?

2013 ◽  
Author(s):  
Falko Fecht ◽  
Andreas Hackethal ◽  
Yigitcan Karabulut
Keyword(s):  
Retail Investors ◽  
Proprietary Trading

scholarly journals Bank Regulatory Reform In The United States: The Case Of Goldman And The Volcker Rule

2010 ◽  
Vol 6 (6) ◽  
Author(s):  
Elizabeth Holowecky ◽  
Ashley Murry ◽  
Violeta Staneva ◽  
Jayne Fuglister
Keyword(s):  
Federal Reserve ◽  
Banking Industry ◽  
Investment Banking ◽  
Regulatory Reform ◽  
The United States ◽  
Wall Street ◽  
The Past ◽  
Current Financial Crisis ◽  
Proprietary Trading ◽  
Volcker Rule

This case is an ethics case.  The focus is on corporate governance in a major Wall Street bank, Goldman Sachs.  The case discusses what Congress has done in the past and what it may do in the future to prevent breaches in ethics relating to proprietary trading.  In response to the current financial crisis, Congress has proposed many changes for the banking industry and the proposals have gained momentum because of the SEC’s accusation of fraud at Goldman Sachs.  One piece of proposed legislation, endorsed by President Barack Obama and former chairman of the Federal Reserve, Paul Volcker, is based on the Volcker Rule.  This rule would return the banking industry to the decades of the Glass-Steagall provisions of the Banking Act of 1933.  The Volcker Rule would reinstitute the separation of commercial and investment banking. 

The Volcker Rule: Financial Crisis, Bailouts, and the Need for Financial Regulation

2017 ◽  
pp. 1-5
Author(s):  
Dylan Minor ◽  
Nicola Persico
Keyword(s):  
Financial Institutions ◽  
Financial Regulation ◽  
Business Environment ◽  
Securities And Exchange Commission ◽  
Regulatory Change ◽  
Fiscal Stimulus ◽  
Nonmarket Strategy ◽  
Proposed Regulation ◽  
Proprietary Trading ◽  
Volcker Rule

In response to the potential collapse of large financial institutions in 2007, the U.S. government committed trillions of dollars to loans, asset purchases, guarantees, direct spending to provide fiscal stimulus, expansionary monetary policy, and bailouts of various private financial institutions. The bailouts were especially controversial because public money was used to protect private financial institutions and their wealthy executives while ordinary citizens received no such protection. One outcome of the government's response was the proposal to enact into law the Volcker rule, which prohibited banks from engaging in proprietary trading, or trading for their own---not their clients'---benefit. Proprietary trading was believed to generate up to 10 percent of total trading revenues, which would have exceeded $5.9 billion in 2010 for the six largest American banks alone. If the Volcker rule were to become law, government agencies, including the Federal Reserve, the Securities and Exchange Commission, the FDIC, and the Office of the Comptroller of the Currency, would write the detailed regulations that would implement the law. These agencies employed civil servants but were run by political appointees with technical backgrounds. After issuing a notice of proposed rulemaking the agencies would solicit comments from the public, which would help shape the regulations. Executives of large banks needed to decide how to respond to this potential change in their business environment.After analyzing the case, students should be able to: Understand and map out the various interests at work in shaping a regulation Develop a nonmarket strategy for a company facing a potential regulatory change Predict the likely outcome of a proposed regulation

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