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Full-Text Articles in Law
The Federal Reserve As Last Resort, Colleen Baker
The Federal Reserve As Last Resort, Colleen Baker
University of Michigan Journal of Law Reform
The Federal Reserve, the central bank of the United States, is one of the most important and powerful institutions in the world. Surprisingly, legal scholarship hardly pays any attention to the Federal Reserve or to the law structuring and governing its legal authority. This is especially curious given the amount of legal scholarship focused on administrative agencies that do not have anywhere near as critical a domestic and international role as that of the Federal Reserve. At the core of what the Federal Reserve does and should do is to conduct monetary policy so as to safeguard pricing, including that …
The Boundaries Of Most Favored Nation Treatment In International Investment Law, Tony Cole
The Boundaries Of Most Favored Nation Treatment In International Investment Law, Tony Cole
Michigan Journal of International Law
Contemporary international investment law is characterized by fragmentation. Disputes are heard by a variety of tribunals, which often are constituted solely for the purpose of hearing a single claim. The law applicable in a dispute is usually found in a bilateral agreement, applicable only between the two states connected to the dispute, rather than in a multilateral treaty or customary international law. Moreover, the international investment community itself is profoundly divided on many issues of substantive law, meaning both that the interpretation given to international investment law by a tribunal will be determined largely by those who sit on it, …
High-Frequency Trading: Should Regulators Do More, Matt Prewitt
High-Frequency Trading: Should Regulators Do More, Matt Prewitt
Michigan Telecommunications & Technology Law Review
High-Frequency Trading ("HFT") is a diverse set of algorithmic trading strategies characterized by fast order execution. Its importance in international markets has increased vastly in recent years. From a regulatory perspective, HFT presents difficult and partially unresolved questions. The difficulties stem partly from the fact that HFT encompasses a wide range of trading strategies, and partly from a dearth of unambiguous empirical findings about HFT's effects on markets. Yet certain important conclusions are broadly accepted. HFT can increase systemic risk by causing or exacerbating events like the "Flash Crash" of May 6, 2010. HFT can also enable market manipulators to …
The Meaning Of The Market Myth, Benjamin Means
The Meaning Of The Market Myth, Benjamin Means
Michigan Business & Entrepreneurial Law Review
This Book Review contends that the perfectly rational market may be a myth, not just in the sense of a false or over-simplified account of reality, but also in the deeper, anthropological sense of cultural explanation. Part I describes how rational-market theories were developed by financial economists and applied to Wall Street, sometimes without adequate appreciation for the difference between simplified economic models and real-world behavior. Part II contends that if the rational-market theory has met with acceptance that outstrips its empirical support, the favorable reception may be explained in part by the theory’s congruence with broader normative views about …
The Dog That Didn't Bark: Private Investment Funds And Relational Contracts In The Wake Of The Great Recession, Robert C. Illig
The Dog That Didn't Bark: Private Investment Funds And Relational Contracts In The Wake Of The Great Recession, Robert C. Illig
Michigan Business & Entrepreneurial Law Review
In the aftermath of the subprime mortgage crisis, the contract rights of numerous hedge funds and venture capital funds were breached. These contracts were complex and sophisticated and had been negotiated at great time and expense. Yet despite all of the assumptions of neo-classical contracts theory, nothing happened. Practically none of these injured parties sued to enforce their rights. Professor Illig uses this dearth of litigation to conduct a form of natural experiment as to the value of contract law. Discrete market participants contracted before the crash and then pursued their rights in court afterwards, while relational market participants contracted …