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Articles 1 - 4 of 4
Full-Text Articles in Law
Fenceposts Without A Fence, Katherine E. Dr Lucido, Nicholas K. Tabor, Jeffery Y. Zhang
Fenceposts Without A Fence, Katherine E. Dr Lucido, Nicholas K. Tabor, Jeffery Y. Zhang
Articles
Banking organizations in the United States have long been subject to two broad categories of regulatory requirements. The first is permissive: a “positive” grant of rights and privileges, typically via a charter for a corporate entity, to engage in the business of banking. The second is restrictive: a “negative” set of conditions on those rights and privileges, limiting conduct and imposing a program of oversight and enforcement, by which the holder of that charter must abide. Together, these requirements form a legal cordon, or “regulatory perimeter,” around the U.S. banking sector.
What Is The Law’S Role In A Recession?, Gabriel V. Rauterberg, Joshua Younger
What Is The Law’S Role In A Recession?, Gabriel V. Rauterberg, Joshua Younger
Law & Economics Working Papers
The last two years have seen astonishing changes to how fiscal and monetary authorities in the developed world manage the economy. In the face of the largest global economic contraction since World War II, governments embarked on massive campaigns of economic stimulus, far outpacing the response to the Global Financial Crisis. Central banks similarly engaged in financial intervention on a scale not seen in eighty years. Over roughly a year, the Federal Reserve alone doubled its asset holdings from around $4 trillion to $8 trillion, making for arguably the most aggressive expansion of the United States’ money supply since the …
Learning To Manipulate A Financial Benchmark, Megan Shearer, Gabriel V. Rauterberg, Michael P. Wellman
Learning To Manipulate A Financial Benchmark, Megan Shearer, Gabriel V. Rauterberg, Michael P. Wellman
Law & Economics Working Papers
Financial benchmarks estimate market values or reference rates used in a wide variety of contexts, but are often calculated from data generated by parties who have incentives to manipulate these benchmarks. Since the London Interbank Offered Rate (LIBOR) scandal in 2011, market participants, scholars, and regulators have scrutinized financial benchmarks and the ability of traders to manipulate them.
We study the impact on market welfare of manipulating transaction-based benchmarks in a simulated market environment. Our market consists of a single benchmark manipulator with external holdings dependent on the benchmark, and numerous background traders unaffected by the benchmark. We explore two …
The Orkney Slew And Central Bank Digital Currencies, Jeffery Y. Zhang, Gary B. Gordon
The Orkney Slew And Central Bank Digital Currencies, Jeffery Y. Zhang, Gary B. Gordon
Articles
This Article on central bank digital currencies is motivated by a parable, The Orkney Slew, which is set in an archipelago. Based on the parable, we point out a significant economic market failure that exists in the cross-border payments realm. The analysis then focuses on real-world examples and the national security concerns, including for Anti-Money Laundering/Combatting the Financing of Terrorism (AML/CFT) and the continued efficacy of U.S. sanctions, associated with the rapidly evolving digital payments landscape.
Many central banks around the world are now cooperatively experimenting with cross-border interoperability of digital currencies. These efforts are driven by the idea of …