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Full-Text Articles in Law

Federalism Of Personal Finance: State & Federal Retirement Plans, William Birdthistle Dec 2017

Federalism Of Personal Finance: State & Federal Retirement Plans, William Birdthistle

William Birdthistle

In this Article, I consider possible approaches that attempt to improve the plans through which millions of Americans tend to their life savings. I begin by considering the inadequacies of our current system of defined contribution accounts and then address two possible alternatives: the first being a federal account universally available to Americans based largely on the model of the Thrift Savings Plan; the second being a system of statebased retirement accounts like those that have already been developed in a handful of states. Though I conclude that a single, federal plan would be superior, either alternative approach would be ...


Becoming A Fifth Branch (With M. Henderson), William Birdthistle Dec 2012

Becoming A Fifth Branch (With M. Henderson), William Birdthistle

William Birdthistle

Observers of our federal republic have long acknowledged that a fourth branch of government comprising administrative agencies has arisen to join the original three set forth in the Constitution. In this Article, we focus our attention on the emergence of yet another branch comprising financial self-regulatory organizations (SROs). In the late eighteenth century, long before the establishment of state and federal securities authorities, the financial industry created its own SROs. These private institutions then coexisted with the public authorities for much of the past century in a complementary array of informal and formal policing mechanisms. That equilibrium, however, appears to ...


Breaking Bucks In Money Market Funds, William Birdthistle Dec 2009

Breaking Bucks In Money Market Funds, William Birdthistle

William Birdthistle

This Article argues that the Securities and Exchange Commission’s first and most significant response to the economic crisis increases rather than decreases the likelihood of future failures in money market funds and the broader capital markets. In newly promulgated regulations addressing the "breaking of the buck" in the $3 trillion money market - a debacle at the fulcrum of the 2008 financial meltdown - the SEC endorses practices that obfuscate rather than illuminate the capital markets, including fixed pricing for money market funds, potentially riskier portfolio requirements, and the continued use of discredited ratings agencies. These policies, premised implicitly upon doubt ...


Breaking Bucks: Sec Regulation By Obfuscation, William A. Birdthistle Dec 2009

Breaking Bucks: Sec Regulation By Obfuscation, William A. Birdthistle

William Birdthistle

This Article argues that the Securities and Exchange Commission’s first and most significant response to the economic crisis profoundly contradicts widely accepted theoretical and regulatory approaches to financial oversight. More alarmingly, the SEC’s newest rules increase rather than decrease the likelihood of future failures in money market funds and the broader capital markets. Scholars – of both neoclassical and behavioral economic theory – have long insisted that transparency and disclosure play essential roles in ensuring efficient capital markets and sound financial regulation. Professors Gilson and Kraakman notably argued that the efficient capital market hypothesis, and its reliance on a market ...


Investment Indiscipline: A Behavioral Approach To Mutual Fund Jurisprudence, William Birdthistle Dec 2009

Investment Indiscipline: A Behavioral Approach To Mutual Fund Jurisprudence, William Birdthistle

William Birdthistle

Next Term, in Jones v. Harris, the Supreme Court will be called upon to resolve philosophical divergences on a massive, critical, yet academically slighted subject: the dysfunctional system through which almost one hundred million Americans attempt to save more than ten trillion dollars for their retirement. When this case was in the Seventh Circuit, two of the foremost theorists of law and economics, Chief Judge Frank Easterbrook and Judge Richard Posner, disagreed vociferously on competing analyses of the investment industry. The Supreme Court’s ruling will not only resolve the intricate fiduciary and doctrinal issues of this dispute but also ...


Compensating Power: An Analysis Of Rents And Rewards In The Mutual Fund Industry, William Birdthistle Jan 2006

Compensating Power: An Analysis Of Rents And Rewards In The Mutual Fund Industry, William Birdthistle

William Birdthistle

The allegations of malfeasance in the investment management industry - market timing, late trading, revenue sharing, and several others - involve a broad range of mutual fund operations. This Article seeks to explain the common source of these irregularities by focusing upon a trait they share: the practice of investment advisers' capitalizing upon their managerial influence to increase assets under management in order to generate greater fees from those assets. This Article extends theories of executive compensation into the context of investment management to understand the extraction of rents by mutual fund advisers. Investment advisers, as collective groups of portfolio managers, interact ...