tag:blogger.com,1999:blog-602664611343971452.post6614682808042309761..comments2024-01-06T08:57:16.475-05:00Comments on Trust Your Instincts: Jesse Eisinger nails why ultra transparency is needed as replacement for regulators' information monopoly and their interpretation of Volcker RuleAnonymoushttp://www.blogger.com/profile/11316888485290662469noreply@blogger.comBlogger2125tag:blogger.com,1999:blog-602664611343971452.post-15015132628940035512012-04-20T13:39:06.766-04:002012-04-20T13:39:06.766-04:00Reducing reliance on Basel regulations for risk ca...Reducing reliance on Basel regulations for risk capital is one of the advantages of ultra transparency.<br /><br />The Basel regulations are the results of negotiations between the banks and their regulators. As such, they are designed to benefit the industry.<br /><br />I realize regulators claim that the Basel regulations enhance financial stability, however, compliance with Basel III is impossible to independently confirm with current disclosure practices. <br /><br />This does not enhance financial stability. It simply uses complexity to create opacity and lessen the ability of the market to discipline the largest financial institutions.<br /><br />My intent with ultra transparency is not to waive the Volcker Rule. It is to use the market as mechanism for enforcing compliance with the rule.Anonymoushttps://www.blogger.com/profile/11316888485290662469noreply@blogger.comtag:blogger.com,1999:blog-602664611343971452.post-29400632458851946422012-04-20T12:55:28.177-04:002012-04-20T12:55:28.177-04:00Instead of a waivable binary Volcker Rule, they sh...Instead of a waivable binary Volcker Rule, they should use a Taylor-like Rule that changes with leverage squared, volatility and inversely GNP (the SDE is (L-1) dr + L d var). A numerical rule is harder to waive, and can fit into Basel regulations for risk capital.Anonymousnoreply@blogger.com