Financial Regulation after the Global Recession

CARLOS M. PELÁEZ received a PhD and BS, Phi Beta Kappa from Columbia University, City of New York, USA. He has published books, essays and articles worldwide, including International Financial Architecture, The Global Recession Risk, Globalization and the State: Volume I, Globalization and the State: Volume II and Regulation of Banks and Finance. He was Director of the Banco Chase and of the Rio de Janeiro Association of Banks and Vice President of Chase Manhattan Bank, USA. He is Managing Director of CMP Associates, USA.CARLOS A. PELÁEZ received the AB in Statistics from the University of Chicago, USA and the JD from the University of Pennsylvania Law School, where he was a Senior Editor of the Journal of International Law. He has published books and essays worldwide, including International Financial Architecture, The Global Recession Risk, Globalization and the State: Volume I, Globalization and the State: Volume II and Regulation of Banks and Finance. He works for a large law firm in New York City, USA.

• List of Tables List of Diagrams List of Abbreviations Acknowledgments Introduction, Scope and Content PART I: GOVERNMENT INTERVENTION AND FINANCE Introduction The First Best of Efficiency and Satisfaction The Theory of Second Best The Public Interest View Imperfect Information Government Failure Transactions Costs and Property Rights The New Institutional Economics The Economic Theory of Regulation Rent-seeking and Public Choice The View of Disclosure and Regulation The Political Economy of the Regulatory State Contrasts of Public and Private Interest Views Applied Welfare Economics Finance, Efficiency and Growth Summary Appendix: Security Prices and Cost/Benefit Analysis PART II: BANK REGULATION Introduction Approaches to Bank and Financial Regulation Banks Versus Finance Prudential and Systemic Regulation Functional and Structural Finance The Law and Finance View Bank Functions Monitoring and Diversification Liquidity Transformation Housing Finance Securitization and Credit-risk Transfer Bank Capital Theory and Requirements International Capital Requirements Deposit Insurance Political Economy Summary PART III: BANK CONCENTRATION AND CENTRAL BANKS Introduction Banking Market Organization Competition and Productivity Restrictions on Markets Bank Concentration Central Banks The Federal Reserve System and US Regulators and Supervisors The European Central Bank The Bank of Japan The Bank of England General Principles of Central Banking Central Banking in the United Kingdom Monetary Policy, Income and Prices Summary PART IV: UNIVERSAL BANKING, GOVERNANCE AND COMPENSATION Introduction Universal and Specialized Banking The Political Economy of Securities Legislation Economic Analysis of Glass-Steagall The Gramm-Leach-Bliley Financial Modernization Act Hedge Funds Corporate Governance Remuneration Corporate Law Summary PART V: REGULATION OF SECURITIES AND CAPITAL MARKETS Introduction Rules and Principles The SEC and Self-regulatory Organizations The Financial ServicesAuthority Proposals of Capital Market Regulators The Sarbanes-Oxley Act of 2002 The Law Economic Evaluation Corporate Governance and Performance Gatekeepers Regulation and the Choice of Exchange Listing Summary PART VI: REGULATION AND POLICY IN THE GLOBAL RECESSION Introduction The New Deal What Caused the Credit Crisis and Global Recession? The Instruments of Monetary Policy The Troubled Assets Relief Program Financial Stability Plan Mortgage Modification Fiscal Policy Liquidity Guarantee The Swedish Bank Workout Regulation Summary Conclusion Notes Index