This Week in Financial Regulation, September 23rd
News and Commentary Jesse Hamilton reports for Bloomberg that the Fed may extend a cap on dividend payments and a ban on share buybacks. New stress tests may increase capital [...]
This Week in Financial Regulation, September 16th
News and Commentary Diego Zuluaga describes the undesirability of financial transaction taxes in the Cato Journal, claiming that they raise less revenues than expected while decreasing short term trading. JDSupra [...]
This Week in Financial Regulation, September 10th
News and Commentary Hannah Lang at American Banker reports that the Fed published capital requirements incorporating a stress capital buffer: the projected change in capital ratio under severe stress. In [...]
We Shouldn’t Count on the Fed
In March, as the COVID-19 pandemic came to a head in the United States, the Federal Reserve took action to shore up the financial sector in the face of an [...]
The Performance of Hedge Fund Performance Fees
We study the long-run outcomes associated with hedge funds' compensation structure. Over a 22-year period, the aggregate effective incentive fee rate is 2.5 times the average contractual rate (i.e., around [...]
This Week in Financial Regulation, August 5th
News and Commentary The New York Times reports that the forthcoming stimulus bill from Senate Republicans may include a provision relaxing capital requirements on the nation's biggest banks by allowing regulatory [...]
Does Finance Benefit Society? A Language Embedding Approach
We measure popular sentiment toward finance using a computational linguistics approach applied to millions of books published in eight countries over hundreds of years. We document persistent differences in finance [...]
Why Do Borrowers Default on Mortgages? A New Method For Causal Attribution
There are two prevailing theories of borrower default: strategic default—when debt is too high relative to the value of the house—and adverse life events—such that the monthly payment is too [...]
Does Joining the S&P 500 Index Hurt Firms?
We investigate the impact on firms of joining the S&P 500 index from 1997 to 2017. We find that the positive announcement effect on the stock price of index inclusion [...]
Is Dodd-Frank the Biggest Law Ever?
The Dodd-Frank Wall Street Reform and Consumer Protection Act (commonly known as Dodd-Frank), which was intended to address perceived problems in the financial system and prevent future crises, is the [...]