Big brokerage firms like Goldman Sachs, Lehman Brothers and Morgan Stanley are facing increasing calls this week that they should be regulated the same way as banks because they're so important to the health of the world's financial system. Timothy Geithner, president of the Federal Reserve Bank of New York, said in a speech on Monday that all institutions that play a central role in financial markets -- including the largest global brokerage firms -- should operate under a unified regulatory framework. That would include "appropriate requirements for capital and liquidity," helping to strengthen the financial system's "shock absorbers" to limit the impact of any future collapse by a major institution, he explained. http://www.marketwatch.com/news/sto...x?guid={11CABCD4-0671-4C16-8702-FED2FB41E1D3}
will this really make a difference?pimco seem to have made a excellent forecast when they said private equity and other financial firms will fill the gap of the investment banks when the fed takes over their regulation
Regulation only leads to more problems. Let the market rule. If you put your money into a company without checking what they're doing with it you can't blame the government for not regulating them
THEY WERE AND WAS REGULATED 1934 SECURITIES ACT BUT OVER THE YEARS THE REGULATIONS HAVE BEEN WEAKEN AND TOOTLESS.
BROKERS USED TO HAVE THE KNOW THY CLIENT RULE...WHICH MEANT YOU CAN'T RECOMMEND FINANCIAL INVESTMENTS THAT ARENT' SUITABLE FOR CLIENT OR TOO RISKY FOR THE PORTFOLIO... AND THERE AREA LEVERAGE RULES TO PREVENT A DOMINOES COLLAPSE....AND LIMITS ON ONE POSITION..ETC... RULES ON FRONTRUNNING AND CLIENT PRIVACY...INSIDE TRADING. OR RULES AGAINST TRADING AGAINST CLIENTS ETC.