9 US and EU Regulatory Responses to The Global Financial Crisis

This chapter examines the impact of the 2007–08 global financial crisis on the regulation of private investment funds in the United States and in the European Union. It begins with a review of Dodd-Frank, which can be seen as the U.S. movement towards the international consensus that private fund managers should be directly regulated by the national financial regulator. It then considers Dodd-Frank’s repeal of the so-called ‘private adviser exemption’ previously found in the Investment Advisers Act of 1940, along with its exemption of ‘foreign private advisers’ from registration. It also explains the distinction between ‘US advisers’ and ‘non-US advisers’, Dodd-Frank’s compliance requirements for various types of investment advisers, and Rule 204(b)-1, jointly approved by the Securities and Exchange Commission and the Commodity Futures Trading Commission under the Investment Advisers Act. The chapter concludes with an analysis of the Alternative Investment Fund Managers Directive (AIFMD) and future outlook for Dodd-Frank.

The Law of Private Investment Funds

10.1093/law/9780198807247.001.0001 ◽

2018 ◽

Author(s):

Spangler Timothy

Keyword(s):

Hedge Funds ◽

Financial Services ◽

Private Equity ◽

Global Financial Crisis ◽

Private Investment ◽

Investment Fund ◽

Investment Funds ◽

Fund Managers ◽

This book provides a clear and concise dual US/UK and pan-asset analysis on the legal and regulatory issues that arise in connection with private investment funds. The book advises on the structuring, formation, and operation of a range of asset classes, including hedge funds, private equity funds, real estate funds, and other non-retail collective investment vehicles. This edition has been revised to reflect the numerous and significant developments in financial services regulation on both sides of the Atlantic since the publication of the second edition. More elements of the Dodd Frank financial regulatory reforms, which increased the scope and reach of regulation applicable to private funds, have been implemented and commented on in this edition. In relation to European regulation, the impact of the commencement of the Alternative Investment Fund Managers Directive (AIFMD) has also now been analysed. The US/UK approach is maintained, but this edition now also includes consideration of third countries, particularly the Middle East and Asia. An entirely new chapter is dedicated to litigation and regulatory enforcement, and some treatment is given to the effects of the global financial crisis, in particular the regulatory response and the changes to negotiating leverage of fund managers and fund investors. The potential impact of ‘Brexit’ on the United Kingdom private funds industry and the future of the AIMFD and European private funds is also examined.

17 Towards a Unified Theory for Private Investment Funds

10.1093/law/9780198807247.003.0017 ◽

2018 ◽

Author(s):

Spangler Timothy

Keyword(s):

Financial Crisis ◽

Hedge Funds ◽

Private Equity ◽

Global Financial Crisis ◽

Financial Innovation ◽

Private Investment ◽

Investment Fund ◽

Investment Funds ◽

Equity Funds ◽

The Global Financial Crisis

This chapter considers future legal and regulatory responses to private investment funds in the context of a country’s current political dynamics. It begins with a discussion of the regulatory policy issues surrounding private investment funds before and after the global financial crisis, criticisms against private equity funds and hedge funds, and lessons from the Alternative Investment Fund Managers Directive. It then examines indirect regulation of private investment funds as a way forward, along with financial innovation and regulatory arbitrage. In particular, it explains how the global financial crisis has exposed the complexity of modern financial markets, noting that one of the primary drivers of this complexity has been financial innovation. The chapter concludes by analysing investor-centric approaches to addressing the governance challenge present in private investment funds.

15 Litigation and Enforcement involving Private Funds after the Global Financial Crisis

10.1093/law/9780198807247.003.0015 ◽

2018 ◽

Cited By ~ 1

Author(s):

Spangler Timothy

Keyword(s):

Financial Crisis ◽

Hedge Funds ◽

Global Financial Crisis ◽

Private Investment ◽

The United States ◽

Regulatory Regime ◽

Investment Funds ◽

The Subject ◽

The Uk

This chapter focuses on the increase in the amount of litigation and enforcement actions against private investment funds in the United States, the UK, and across the globe as a result of the global financial crisis. As more disputes arose during the course of the global financial crisis, the legal and regulatory regime impacting private investment funds has been the subject of closer scrutiny than has been seen in previous decades. The chapter first considers the Securities and Exchange Commission’s (SEC) enforcement actions against hedge funds as well as U.S. civil litigation prior to the financial crisis before discussing Dodd-Frank and its effect on enforcement. It then examines the SEC’s enforcement actions regarding broker-dealer registration, along with some of its key enforcement actions after Dodd-Frank. It also analyses the Financial Conduct Authority’s enforcement priorities after the global financial crisis and key litigation in the UK involving private investment funds.

Fiscal and Monetary Policies in Reaction to the Financial Tsunami by the Taiwanese Government

Review of Pacific Basin Financial Markets and Policies ◽

10.1142/s0219091511002172 ◽

2011 ◽

Vol 14 (01) ◽

pp. 153-169 ◽

Cited By ~ 4

Author(s):

Hsiao-Yin Chen ◽

Cheng-Few Lee ◽

Tzu Tai ◽

Kehluh Wang

Keyword(s):

Financial Crisis ◽

Financial Market ◽

Global Financial Crisis ◽

The United States ◽

Insurance Companies ◽

Monetary Policies ◽

Policy Measures ◽

The Impact ◽

Taiwanese Government

The main purpose of this paper is to investigate the impact of the 2007 financial tsunami on the Taiwanese financial market. We find that, although significant for banks, security firms, and insurance companies, the effect was relatively lower if compared with that in Europe and the United States. In addition, we present fiscal and monetary policies issued by the Taiwanese government in reaction to the global financial crisis. These policy measures focused on stabilizing the financial market, reducing the level of unemployment, and creating more lending opportunities in support of Taiwanese companies. We also discuss the policy measures of the US government and other Asian countries in relation to the global financial crisis. Finally, we provide some suggestions to improve financial supervision and enhance financial reforms in Taiwan.

Evaluation of the Impact of the Global Financial Crisis on the Innovative Performance of Lithuanian Industrial and Service Companies in the European Union Context

Journal of Economics Business and Management ◽

10.7763/joebm.2015.v3.326 ◽

2015 ◽

Vol 3 (11) ◽

Author(s):

Rytis Krusinskas

Keyword(s):

European Union ◽

Financial Crisis ◽

Global Financial Crisis ◽

The European Union ◽

Innovative Performance ◽

Service Companies ◽

Assessing The Impact Of The Global Financial Crisis On GCC Countries

Journal of Business & Economics Research (JBER) ◽

10.19030/jber.v8i2.682 ◽

2010 ◽

Vol 8 (2) ◽

Cited By ~ 4

Author(s):

Hisham H. Abdelbaki

Keyword(s):

Financial Crisis ◽

Interest Rates ◽

Global Financial Crisis ◽

The United States ◽

Font Size ◽

Negative Effects ◽

Gcc Countries ◽

The World ◽

No doubt, the international financial crisis that started in the United States of America will cast its effects on all countries of the world, developed and developing. Yet these effects vary from one country to another for several reasons. The GCC countries would not escape these negative effects of this severe crisis. The negative effects of the crisis on gulf countries come from many aspects: first, decrease in price of oil on whose revenues the development programs in these countries depend; second, decrease in the value of US$ and the subsequent decrease in the assets owned by these countries in US$; third, a case of economic stagnation will prevail in the world with effects starting to appear. It is obvious that this would be reflected on the real sector in the economies causing a series of negative effects through decrease of the world demand for exports of GCC countries of oil, petrochemicals and aluminum.  Lastly, increased inflation rates with decreased interest rates will result in a decrease in real interest with an accompanying decrease in incentives for saving and consequently investment and economic development. The main aim of the research is to assess the economic effects of the global financial crisis on GCC countries. The paper results are that the big reserves of foreign currencies achieved by the GCC countries in the past few years have helped increase their ability to bear the effects of the financial effects on one hand and their ability to adopt expansionary policies through pumping liquidity to absorb the regressive effects of the crisis on the other. The paper recommends the necessity of taking precautionary procedures for the effects which will result from the expansionary policies effective in GCC countries.

Dispersion of inflation expectations in the European Union during the global financial crisis

Equilibrium ◽

10.12775/equil.2016.033 ◽

2016 ◽

Vol 11 (4) ◽

pp. 737 ◽

Cited By ~ 1

Author(s):

Jan Acedański ◽

Julia Włodarczyk

Keyword(s):

European Union ◽

Financial Crisis ◽

Global Financial Crisis ◽

Inflation Expectations ◽

The European Union ◽

Member States ◽

Inflation Rates ◽

Initial Drop ◽

Inflation expectations, both their median and dispersion, are of great importance to the effectiveness of monetary policy. The goal of this paper is to examine the impact of the global financial crisis on dispersion of inflation expectations in the European Union. Using European Commission’s survey data, we find that in the early phase of the crisis the dispersion dropped rapidly but then, after Lehman Brothers’ collapse, the trend reversed and these fluctuations cannot be explained by movements of inflation rates and other commonly used factors. We also observe that, in the new European Union member states, the initial drop of the dispersion was weaker whereas the subsequent rise was stronger as compared to the old member states.

THE IMPACT OF THE GLOBAL ECONOMIC CRISIS ON THE POLAND

Humanities & Social Sciences Reviews ◽

10.18510/hssr.2021.9428 ◽

2021 ◽

Vol 9 (4) ◽

pp. 202-208

Author(s):

Aleksandra Korczyc

Keyword(s):

European Union ◽

Financial Crisis ◽

Global Financial Crisis ◽

Global Analysis ◽

Modern World ◽

The European Union ◽

Remedial Actions ◽

The Government ◽

Purpose of the study: This study aims to present the specifics of the global financial crisis, the threats it brings for Poland in the legal sphere, and possible actions to be taken in this area, particularly at the European Union and Poland level. Methodology: The article uses the historical method and the analysis of documents both at the Polish and European Union levels, including laws, regulations, and decisions. Main Findings: The scope of the financial crisis in question and its relatively easy transfer between markets entails the necessity to apply extraordinary remedial actions. Poland, through its participation in the European Union, seems to be relatively well protected against the effects of the financial crisis. However, it needs to undertake further structural reforms, in particular reforms of public finances. Applications of this study: The current study is highly significant for the government of the day in this modern world; the study could be quite effective and meaningful for Higher Education Institutions, government, banks, financial institutions. Novelty/Originality of this study: Description of the essence of the financial crisis, possibilities of its prevention - earlier possibilities of remedial actions at the institutional and legal level, possibilities of obtaining financial support, global analysis of the problem, including its causes.

The Impact of the Global Financial Crisis on Central Banking

The Oxford Handbook of the Economics of Central Banking ◽

10.1093/oxfordhb/9780190626198.013.6 ◽

2019 ◽

pp. 170-192

Author(s):

Alex Cukierman

Keyword(s):

Financial Crisis ◽

Interest Rates ◽

Financial Stability ◽

Inflation Targeting ◽

Global Financial Crisis ◽

The United States ◽

Central Banking ◽

The Impact ◽

Regulatory Reforms

This chapter describes the impacts of the global financial crisis on monetary policy and institutions. It argues that during the crisis, financial stability took precedence over traditional inflation targeting and discusses the emergence of unconventional policy instruments such as quantitative easing (QE), forex market interventions, negative interest rates, and forward guidance. It describes the interaction between the zero lower bound (ZLB) and QE, and proposals, such as raising the inflation target, to alleviate the ZLB constraint. The chapter discusses the consequences of the relative passivity of fiscal policies, “helicopter money,” and 100 percent reserve requirement. The crisis triggered regulatory reforms in which central banks’ objectives were expanded to encompass macroprudential regulation. The chapter evaluates recent regulatory reforms in the United States, the euro area, and the United Kingdom. It presents data on new net credit formation during the crisis and discusses implications for exit policies.

The Paradox of the Global and the Local in the Financial Crisis of 2008: Applying the Lessons of Caritas in Veritate to the Regulation of Consumer Credit in the United States and the European Union

Journal of Law and Religion ◽

10.1017/s0748081400000941 ◽

2010 ◽

Vol 26 (1) ◽

pp. 173-212 ◽

Cited By ~ 1

Author(s):

Elizabeth R. Schiltz

Keyword(s):

Financial Crisis ◽

Real Estate ◽

Global Financial Crisis ◽

The United States ◽

Mortgage Loan ◽

The European Union ◽

Current Crisis ◽

Contractual Relationship ◽

Caritas In Veritate ◽

The Individual

In his recent encyclical Caritas in Veritate, Pope Benedict XVI grapples with one of the most vexing paradoxes concerning the current global economic crisis. There is no question that it is a global financial crisis. The collapse of the subprime mortgage loan market in the U.S. in 2007 prefigured similar collapses of real estate bubbles in other parts of the world. The collapse of these real estate bubbles exposed the degree of interconnectedness among financial institutions across the globe created by the worldwide market for the derivate investment products created on the backs of the underlying real estate loans—the mortgage-backed securities in all their complex manifestations, and the credit default swaps that were essentially insurance policies on the risks of default of these securities. Various configurations of international coordinating bodies have called for global responses to the crisis. At its root, however, the current crisis is in a very important sense fundamentally a uniquely local phenomenon. It is the result of individual consumer transactions that are about as inherently local as a commercial transaction can ever get—loans to specific individual consumers tied to specific unique, unmovable pieces of residential real estate. Every single loan packaged into the bundles of investment opportunities that became “toxic assets” held by large institutional investors originated with a contractual relationship between an individual borrower and a single lender. In addition to the global macroeconomic consequences of the collapse of this market, every one of these loans that goes into default has personal consequences for the individual borrower whose home is the collateral for that loan.