CHAPTER 2. The Future and Sustainability of Financial Markets after the Covid-19 Crisis

2021 ◽  
pp. 22-47
Keyword(s):  
Financial Markets ◽  
The Future

The Future Ain’t What It Used to Be

2018 ◽  
Author(s):  
Ashoka Mody
Keyword(s):  
Financial Markets ◽  
Social Problems ◽  
Financial Integration ◽  
Fiscal Rules ◽  
Fiscal Discipline ◽  
European Project ◽  
The Future ◽  
The Right

This chapter describes two scenarios, the two possible ways in which the final act of the European project plays out. In the first scenario, European authorities remain confident that they have essentially been on the right track and they continue to make modest course corrections, which they believe will ensure a brighter European future. However, the elusive and frustrating pursuit of deeper economic and financial integration causes more economic and political damage. Setbacks and crises recur to test the euro and its accompanying political vision. In the second scenario, the pro-European vision, European authorities recognize the important truth that “more Europe” will not solve Europe's most pressing economic and social problems. They dismantle the economically counterproductive and politically corrosive system of fiscal rules and rely more on financial markets to enforce fiscal discipline. Paradoxically, the euro survives, not because it adds value but because it becomes largely irrelevant.

scholarly journals The future of financial markets and regulation: what strategy for Europe?

foresight ◽  
2014 ◽  
Vol 16 (2) ◽  
pp. 95-108 ◽  
Author(s):  
Jean-Baptiste Gossé ◽  
Dominique Plihon
Keyword(s):  
Financial Markets ◽  
Capital Market ◽  
Financial Stability ◽  
Design Methodology ◽  
Financial Integration ◽  
Content Type ◽  
Realistic Option ◽  
The Future ◽  
Unstable Environment ◽  
Insight Into

Purpose – This article aims to provide insight into the future of financial markets and regulation in order to define what would be the best strategy for Europe. Design/methodology/approach – First the authors define the potential changes in financial markets and then the tools available for the regulator to tame them. Finally, they build five scenarios according to the main evolutions observed on the financial markets and on the tools used by the regulator to modify these trends. Findings – Among the five scenarios defined, two present highly unstable features since the regulator refuses to choose between financial opening and independently determining how to regulate finance in order to preserve financial stability. Three of them achieve financial stability. However, they are more or less efficient or feasible. In terms of market efficiency, the multi-polar scenario is the best and the fragmentation scenario is the worst, since gains of integration depend on the size of the new capital market. Regarding sovereignty of regulation, fragmentation is the best scenario and the multi-polar scenario is the worst, because it necessitates coordination at the global level which implies moving further away from respective national preferences. However, the more realistic option seems to be the regionalisation scenario: this level of coordination seems much more realistic than the global one; the market should be of sufficient size to enjoy substantial benefits of integration. Nevertheless, the “European government” might gradually increase the degree of financial integration outside Europe in line with the degree of cooperation with the rest of the world. Originality/value – Foresight studies on financial markets and regulation are quite rare. This may be explained by the difficulty to forecast what will be their evolution in the coming decades, not least because finance is fundamentally unstable. This paper provides a framework to consider what could be the best strategy of regulators in such an unstable environment.

scholarly journals Bail Financial Sharing (BFS): A Financial Subsystem of Rastin PLS Banking

2019 ◽  
Vol 3 (1) ◽  
pp. 21-27
Author(s):  
Bijan Bidabad
Keyword(s):  
Financial Markets ◽  
Raw Materials ◽  
Electronic Devices ◽  
Banking System ◽  
Base System ◽  
The Future ◽  
Application Methods

To cover producers and consumers against future prices fluctuation risk, depositors can forward-purchase raw materials or products to be delivered at a specified time in the future through Bail Financial Sharing (BFS). Bail Financial Sharing is a subsystem of Rastin Profit and Loss Sharing (PLS) banking system, and in this regard, instructions, organization and application methods, and electronic devices and contracts are similar to the context defined in the Base System of Rastin PLS banking system. Bail Financial Sharing (BFS) enjoys from Bail Certificate innovation, which can play an important role in stabilizing and increasing efficiency of money and financial markets. Depositor (financer) receives digital Bail Certificate for this kind of participation, which is negotiable in the secondary Rastin Certificate market. Regarding the characteristics of this certificate and its clear substantial differences with futures derivative, it prevents unreal paper markets formation. The latest owner of the certificate is the owner of the commodity. Moreover, the depositor can ask the bank that the entrepreneur sells the commodity and pays the money –instead of commodity- to him at the end of the contract.

Regulation of the EU Financial Markets

2017 ◽  
Keyword(s):  
Financial Markets ◽  
The Future ◽  
Eu Financial Markets ◽  
The Eu

This book aims to analyse and discuss the main changes and new provisions introduced by MiFID II/MiFIR. The book chapters are grouped in a thematic way, covering the following areas: (i) investment firms and investment services, (ii) trading, (iii) supervision and enforcement, (iv) the broader view and the future of MiFID II/MiFIR.

Part V The International Dimension, 13 Hong Kong’s Future as a Leading International Financial Centre

2016 ◽  
Author(s):  
Arner Douglas W ◽  
Hsu Berry FC ◽  
Goo Say H ◽  
Johnstone Syren ◽  
Lejot Paul ◽  
...  
Keyword(s):  
Economic Development ◽  
Hong Kong ◽  
Financial Markets ◽  
Financial Market ◽  
Financial Stability ◽  
International Dimension ◽  
Financial Centre ◽  
Regulatory Systems ◽  
The Future

This chapter summarizes the main arguments and discussions of the book and presents an overview of major concerns for the future of Hong Kong’s financial markets. In addition to describing financial market law and practice in Hong Kong, this book has sought to point out related major issues, whether legal, economic, or cultural. Each chapter has concluded with an evaluation of Hong Kong’s financial markets, identifying weaknesses and where reform is most needed. This final chapter takes the analysis further, presenting an overview of major concerns for the future of Hong Kong’s financial markets and their legal and regulatory systems. These arise in two main respects: first, risks to be addressed out of concern for financial stability and the continued economic development of Hong Kong; and second, opportunities to enhance Hong Kong’s competitiveness as a financial centre, especially in the context of prospects for China and East Asia.

scholarly journals The future of international banking regulations in response to the financial crisis of 2007/2009: After Basel III then what next?

2014 ◽  
Vol 4 (2) ◽  
pp. 28-53 ◽  
Author(s):  
Joseph E. Isebor
Keyword(s):  
Financial Crisis ◽  
Financial Markets ◽  
Financial Stability ◽  
Basel Iii ◽  
International Banking ◽  
The Great Depression ◽  
Banking Regulations ◽  
Basel Accords ◽  
The Future ◽  
Global Financial System

The financial crisis 2007-2009 will not be forgotten in a hurry because of its impact on the global financial system almost replicating the Great Depression. Major and causal factors contributed to the financial crisis, and this prompted the establishment of Basel III to contain the crisis. Basel III introduced improved capital and liquidity rules, but still could not contain the crisis. This leaves regulators with questions of how to prevent another financial crisis in the future. Evidences suggest that the financial market is evolving because of its complex and changing nature, and so are the international banking regulations (Basel I, Basel II and Basel III) that support the system in terms of maintaining economic and financial stability. It is clear that Basel III will not stop the next financial crisis even though the Basel accords continue to evolve in response to maintaining economic and financial stability, with the core purpose of preventing another financial crisis. Uncertainties lies ahead, and regulators cannot be sure of what will likely cause the next crisis, but indications suggest that the financial markets and international banking regulations in the form of Basel accords will continue to evolve.

scholarly journals Algorithmic trading based on the fear of Covid-19 in Europe

2021 ◽  
Vol 10 (2) ◽  
pp. 295-304
Author(s):  
Raúl Gómez Martínez ◽  
Camilo Prado Román ◽  
Gabriel Cachón Rodríguez
Keyword(s):  
Financial Markets ◽  
Behavioral Finance ◽  
Algorithmic Trading ◽  
Trading System ◽  
Technical Indicators ◽  
The Future

he spread of Covid-19 in Europe has affected our way of living, thinking, and even investing. The fear of the epidemic caused a context of maximum uncertainty and volatility in financial markets, which were driven by fear of the spread of the epidemic. In this article we propose an algorithmic trading system on the future of the Eurostoxx 50 that, instead of following technical indicators, follows the number of cases confirmed by Covid-19 in Europe. The back test of this system carried out throughout the weeks of confinement shows that the system is profitable. In this context, confirmed cases data is useful to assess investors’ mood and anticipate the evolution of the market. Therefore, an alternative way of investing arises for maximum uncertainty contexts, based exclusively on behavioral finance.

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