"A fascinating, lively, and thoroughly readable guide to the Dodd-Frank Act that pierces the cloud of confusion that hangs over so much of the financial reform debate. It is extremely timely and valuable, and should be required reading for all policymakers, investors, and students of finance. What makes the book so valuable is that it not only analyzes the scope of the Act, in a punchy, lively style, but it also discusses its potential impact. More important, the book analyzes what is not covered in the Act—and where the potential challenges to the financial system still lie."
—Gillian Tett, U.S. Managing Editor, Financial Times
"The crisis of 2008 confronted even well-educated Americans with a flood of incomprehensible financial vocabulary, describing novel financial institutions and practices most of us had never heard of before. Now we have the 2,300-page Dodd-Frank Act, designed to provide the needed repair. Will it do so? What else will it do? How can we even start to think about these basic questions? Regulating Wall Street addresses these questions in a clear, direct style, taking us through the many parts of the Act one at a time, and providing informed, cogent economic analysis of each. A valuable standard source for future discussion."
—Robert E. Lucas, University of Chicago, 1995 Nobel Laureate
"Take the faculty of one of the best finance departments in the world. Ask them to analyze the new U.S. legislation on financial regulation, and to think about what the new law gets right, what it gets wrong, and how it is likely to shape the future of the financial system. With a bit of luck, you get this very impressive book. An absolute must-read."
—Olivier Blanchard, Chief Economist, International Monetary Fund
"Regulating Wall Street goes a long way toward clarifying the intent of the various provisions of the Dodd-Frank Act and evaluating both its effectiveness and limitations. The need for effective implementation by agencies is appropriately emphasized. Not a quick read, a useful reference work on an enormously complex piece of legislation, dealing with an even more complex financial reality."
—Paul Volcker, Chairman of the Economic Recovery Advisory Board and former Chairman of the Federal Reserve (1979–1987)
“There are many villains in the story of the recent crisis and much written to name them, describe them and even curse them. . . If you want to know how to fix the problem, I highly recommend ‘Regulating Wall Street,’ from New York University’s Stern School of Business. . . In the excellent book, ‘Regulating Wall Street,’ several of the studies indicate that there are few synergies among financial activities that could lead to economies of scope. The studies also demonstrate that multiple functions in large, complex firms can actually increase systemic risk. Moreover, they suggest that the spun-off activities could thrive without explicit or implied government support. The conclusion in this book is that separating activities in this manner, together with stronger resolution processes and better capital standards, would do much to strengthen our financial system, making it more accountable and stronger.”
—Thomas M. Hoenig, President, Federal Reserve Bank of Kansas City
"Readers should read Regulating Wall Street to understand why, in the face of market failures and copious evidence that Wall Street is unproductive, Congress and regulators labored mightily to resurrect the financial intermediation racket just as it existed on September 12, 2008." (Tax Notes)
“If you want to know how to fix the problem, I highly recommend Regulating Wall Street, from New York University’s Stern School of Business.”
—Karl Denninger, Seeking Alpha
“One refreshing sign of hope for constructive change is that economists, some of whose theories had much to do with a light regulatory approach toward derivatives and the housing bubble, are increasingly producing research calling for stricter guidelines then Dodd-Frank or the Obama administration. Regulating Wall Street presents a wide range of new research supporting stronger regulations than Dodd-Frank recommends, such as . . . tax proposals. . . In the prologue of Regulating Wall Street, the editors, hardly known as progressives, remind financiers how useful strong regulations were in the past. . . We would be better off if the powers on Wall Street would remember. . . “
(New York Review)
The Dodd Frank act brings about fundamental structural changes to the economy with far reaching implications for financial institutions, consumers, and regulatory bodies to name a few. While there have been many articles and white papers that dissect the issues related to the act in isolation, "Regulating Wall Street" is a comprehensive view of the act, going through Dodd-Frank's finer points in great detail, and provides an impartial analysis of its possible implications with insights into the how market and regulatory environments in the future may look like.
This book is a wonderful resource for any financial student and professional as it takes a step back to reflect on the history of regulation and explores the repercussions that arose from these regulations. The ex-post analysis of how the act would have performed during the financial crisis is worthwhile and the drawbacks of factor-based capital charges where the factors are based on historical experience are well-highlighted and points to ponder. Similarly, questions that pertain to the future of the Federal Reserve System are timely as the current discussions in the government will attest.
The book does well to compare Dodd Frank to other regulatory regimes in terms of managing systemic risk and offers new ways to assess and charge for the systemic risk that financial institutions create using prospective views of risk as opposed to static factor based charges. The proposals for taxing systemic risk makes sense in that that if a firm creates a disproportional amount of systematic risk and hence acts as a negative externality to the economy in general, it makes sense to tax the firm proportional to the risk it creates. It is an interesting proposal if it can overcome practical challenges in a formal implementation.
The implications of the reform of the Over-the-Counter (OTC) derivatives and their significance is given due credit in the book as it examines the effect of these reforms on hedging instruments in detail. Some very interesting options to incentivize transparency are discussed and a striking feature of the book is that throughout the book, it weaves well-thought out academic research, a historical perspective and future implications while discussing the key aspects of the bill.
The best part of the book was the discussion of the white elephants in the economy that the act missed and the risks that may still be lingering in the system because of these omissions including how an insurance company, AIG found itself in the center of the crises, and of course, the two F words Fannie Mae and Freddie Mac.
Overall, the book is a culmination of perceptive analysis and well-thought out recommendations from the faculty at NYU and is a must-have for the finance practitioner with neither time nor the legal expertise to skim through 2,319 pages of the Dodd Frank act.
I found the book to be extremely comprehensive as it elaborates on our preconceptions/opinions nicely and offers genuine (non-partisan) opinions of the achievements, faults and possibilities of Dodd-Frank. For those prospective readers who have not been keeping up with, or have been intimidated by, the bombardment of literature on the topic, "Regulating Wall Street" provides an excellent prologue on the events leading up to the current debacle dating back to the Great Depression. This should be required reading for any student and or professional in the world of finance as we brace for Dodd-Franks' monumental impact on the markets.
Product Details :
Hardcover: 592 pages
Publisher: Wiley; 1 edition (November 9, 2010)
Language: English
ISBN-10: 0470768770
ISBN-13: 978-0470768778
Product Dimensions: 6.3 x 1.8 x 9.1 inches
More Details about Regulating Wall Street: The Dodd-Frank Act and the New Architecture of Global Finance, Wiley Finance 1st edition
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