Global ETF News Older than One Year
Global repo markets in transition post-crisis, regulatory changes and central bank stimulus: CGFS report
April 12, 2017-A new report by the Committee on the Global Financial System analyses the changes in the availability and cost of repo financing, a key market for short-term funding, and how these changes affect the ability of repurchasing agreements to support the financial system.
Repo market functioning finds substantial differences in the way repo markets, which allow borrowers to pawn securities for short-term loans, work across countries. Markets are in a state of transition as borrowers and intermediaries adapt to the post-crisis economic and regulatory environment.
view the Repo market functioning April 2017 report
Source: BIS
Blockchain smart contracts raise systemic risk concerns
April 12, 2017--Automated swaps margin payments could exacerbate systemic risks, regulators warn
Regulators have raised concerns about the use of blockchain technology to automate the exchange of margin on derivatives transactions.
Distributed ledger technology (DLT) has been touted as a replacement for existing margin and collateral processes in the derivatives industry, which has struggled to cope with new rules on margining non-cleared trades. But regulators say smart contracts-software developed for DLT systems that can automate post-trade lifecycle events, such as margin calls
Source: Risk.net
Infographic-The 20 Largest Stock Exchanges in the World
April 10, 2017--Investors know the NYSE as a home for the world's most important blue chip stocks. Massive companies like Walmart, Berkshire Hathaway, Exxon Mobil, and Coca-Cola are listed on the exchange along with roughly 2,400 other companies, and together they add up to an astounding $20 trillion in value.
But how do other exchanges around the world, such as the ones in Toronto or London, compare to the famed NYSE?
Source: visualcapitalist.com
Bank research costs asset managers $75.000 a year
April 9, 2017--Fund houses only spend average of $40,000 annually to access independent research.
Source: FT.com
IMF Working Paper-Thick Vs.Thin-Skinned: Technology, News, and Financial Market Reaction
April 7, 2017--We study the impact of technology on the reaction of financial markets to information, focusing on the foreign exchange market. We contrast the "thin-skinned" view that technological improvements cause markets to react more to new information with the "thick-skinned" view that they react less.
We pinpoint exogenous technological changes using the timing of the connection of countries via the submarine fiber-optic cables used for electronic trading. Cable connections dampen the response of exchange rates to macroeconomic news, consistent with the "thick-skinned" hypothesis. This is in line with the view that technology eases access to information and reduces trend-following behavior. According to our estimates, cable connections reduce the reaction of exchange rates to U.S. monetary policy news by 50 to 80 percent.
view the IMF Working Paper-Thick Vs.Thin-Skinned: Technology, News, and Financial Market Reaction
Source: IMF
IMF paints bleak picture for DB funds
April 7, 2017--Defined benefit (DB) pension funds across the world may be forced to cut benefits "significantly" in the long term because of ultra-low interest rates, the International Monetary Fund (IMF) has warned.
Shifting asset allocations to meet required returns "appears feasible only by taking potentially unacceptable levels of risk", the fund said in a new report.
Source: ipe.com
IMF-How an Extended Period of Low Growth Could Reshape the Financial Industry
April 6, 2017--What happens if advanced economies remain stuck in a long-lasting funk marked by tepid growth, low interest rates, aging populations and stagnant productivity? Japan offers an example of the impact on banks, and our analysis suggests that there could also be far-reaching consequences for insurance companies, pension funds, and asset-management firms.
You might argue that this scenario of economic malaise has already materialized; after all, interest rates and economic growth have been low since the financial crisis in 2008. The question is whether the post-crisis landscape represents a temporary departure from the pace of growth we’ve come to expect since World War II, or whether it's the start of a new normal.
Source: IMF
IMF-Global Financial Stability Report
April 6, 2017--Chapter 2 : Low Growth, Low Interest Rates, and Financial Intermediation
Chapter 2 analyzes the potential long-term impact of a scenario of sustained low growth and low real and nominal rates for the business models of financial institutions and the products offered by the financial sector. Advanced economies have experienced low interest rates and growth since the global financial crisis.
Despite recent signs of an increase in longer-term yields, an imminent exit from low rates is not guaranteed, given the prevalence of slow-moving structural factors, such as demographic aging and stagnation in productivity growth. The confluence of these factors could change the nature of financial intermediation. Credit demand would likely be lower whereas household demand for transaction services would likely rise. Consequently, banking in advanced economies may evolve toward fee-based services. Aging will increase demand for health and long-term-care insurance, and low asset returns would accelerate the transition to defined-contribution private pension plans. Demand is likely to weaken for long-term savings products offered by insurers in favor of passive index funds. Policies could help ease the adjustment to such an environment by providing incentives to ensure longer-term stability instead of merely attenuating short-term pain.
Source: IMF
Prudential treatment of problem assets-definitions of non-performing exposures and forbearance
April 4, 20176--The Basel Committee on Banking Supervision has today released the final guidance on the Prudential treatment of problem assets-definitions of non-performing exposures and forbearance.
The definitions promote harmonisation in the measurement and application of two important measures of asset quality, thereby fostering consistency in supervisory reporting.
Source: BIS
Gone with the Headwinds: Global Productivity
April 3, 2017--Productivity growth-the key driver of living standards-fell sharply following the global financial crisis and has remained sluggish since, adding to a slowdown already in train before.
Building on new research, this note finds that the productivity slowdown reflects both crisis legacies and structural headwinds. In advanced economies, the global financial crisis has led to "productivity hysteresis"-persistent productivity losses from a seemingly temporary shock.
Behind this are balance sheet vulnerabilities, protracted weak demand and elevated uncertainty, which jointly triggered an adverse feedback loop of weak investment, weak productivity and bleak income prospects. Structural headwinds-already blowing before the crisis-include a waning ICT boom and slowing technology diffusion, partly reflecting an aging workforce, slowing global trade and weaker human capital accumulation. Reviving productivity growth requires addressing remaining crisis legacies in the short run while pressing ahead with structural reforms to tackle longer-term headwinds.
view the IMF Discussion Note: Gone with the Headwinds: Global Productivity
Source: IMF
