Global ETF News Older than One Year
Structural Breaks in Fiscal Performance: Did Fiscal Responsibility Laws Have Anything to Do with Them? IMF Working paper
November 8, 2010--In recent years, many countries have adopted Fiscal Responsibility Laws to strengthen fiscal
institutions and promote fiscal discipline in a credible, predictable and transparent manner. Still, results on the effectiveness of these laws remain tentative. In this paper, we test
empirically whether fiscal performance, measured as the level of primary fiscal balances and their volatility, indeed improved after the implementation of Fiscal Responsibility Laws in a
sample of Latin American and advanced economies.
We show that traditional econometric approaches, which rely on the use of dummies in time series or panel regressions, yield biased estimates. In contrast, our empirical strategy recognizes that, a priori, the timing of the effect of these laws on fiscal performance is unknown, while controlling for the impact of the business and commodity cycles on fiscal outcomes. Overall, we find limited empirical evidence in support of the view that Fiscal Responsibility Laws have had a distinguishable effect on fiscal performance. However, Fiscal Responsibility Laws could still have other positive effects on the conduct of fiscal policy not analyzed here, for instance, through enhanced transparency and guidance in the budget process and lower risk premia.
Source: IMF
Investors seek transparency in hedge funds
November 8, 2010--Transparency is the leading concern investors share about the publicity-shy $1,800bn global hedge fund industry, followed by fees and managers’ pay, a report shows.
After their worst year ever in 2008 and a painful 18 months of recovery and adaptation, hedge funds have yet to shake off their reputation for secrecy and cost, institutional investors will say in an industry survey due to be released by Ernst & Young on Tuesday.
Source: FT.com
Dow Jones Index Data Monthly Reports
November 5, 2010--The following Dow Jones Index Data Monthly Reports for OCtober 2010 are now available.
Index Data Monthly Report: Asia Pacific Edition
Index Data Monthly Report: MENA Edition
Index Data Monthly Report: Europe Edition
Index Data Monthly Report: Dow Jones-UBS Commodity Indexes
Index Data Monthly Report: Latin America Edition
Index Data Monthly Report: U.S. Edition
Index Data Monthly Report: Dow Jones Brookfield Infrastructure Indexes
Source: Dow Jones Indexes
BlackRock * New Report * ETF Landscape Industry Review, End Q3 2010
November 5, 2010--This report provides an overview of the Exchange Traded Funds (ETFs) and Exchange Traded Products (ETPs) industry through the end of Q3 2010.
At the end of Q3 2010 the global ETF industry had 2,379 ETFs with 5,204 listings, assets of US$1,181.3 Bn from 129 providers on 45 exchanges around the world.
Additionally, there were 878 other Exchange Traded Products (ETPs) with 1,445 listings and assets of US$146.9 Bn from 49 providers on 20 exchanges.
Combined, there were 3,257 products with 6,649 listings, assets of US$1,328.2 Bn from 158 providers on 48 exchanges around the world at the end of Q3 2010.
Source: Global ETF Research & Implementation Strategy Team, BlackRock
US and United Kingdom Lead Financial Development Index Despite Weaknesses; Risks in Emerging Markets Highlighted
The US and United Kingdom manage to hold top spots ahead of Asian financial centres Hong Kong and Singapore
Developing countries continue to show financial stability, but other risks could jeopardize economic growth
Global economic growth continues to rely disproportionately on emerging markets
Report analyses 57 financial systems and capital markets around the world
November 4, 2010--The United States and the United Kingdom managed to take the top spots despite stagnant or weakening scores in the World Economic Forum’s third annual Financial Development Report released today. Weak scores in financial stability for both countries appeared to impact the United Kingdom more with an appreciable decline in its overall score and a drop from the top spot in last year’s rankings. Their rankings were supported by greater relative declines in other countries’ scores.
The scores for Asian financial centres Hong Kong and Singapore advanced to close their distance from the two leaders: both improved slightly, earning them 3rd and 4th place respectively. They had high marks for their robust institutional and business environments and a high degree of financial system stability.
Australia dropped to 5th place, pulled down by declining non-banking financial services activity (such as IPOs and M&As) and a less favourable business environment. Canada maintained 6th place in the rankings. There was some movement of the smaller European economies as the Netherlands and Switzerland switched places from last year to come in at 7th and 8th respectively and Belgium supplanted Denmark at 10th. Japan maintained 9th place based on solid performance across its financial intermediaries and markets.
“While the US and United Kingdom top the rankings due to their deep and active wholesale markets, several ominous signs point to their leadership being in jeopardy. Aside from very low scores in financial stability, both showed weakness in their business environments, in particular their tax regimes, as well as the efficiency of their banks,” said Kevin Steinberg, Chief Operating Officer of the World Economic Forum USA.
view the Financial Development Report 2010
Source: World Economic Forum (WEF)
Economy: Rising tensions could degenerate into protectionism, warns OECD-UNCTAD report
November 4, 2010--G20 leaders must remain vigilant against the risk that tensions over current account imbalances could slow investment or degenerate into a protectionist spiral, according to the OECD and UNCTAD.
In their fourth report to the G20, the organisations find that most new investment measures taken from mid-May to mid-October by governments were aimed at facilitating and encouraging investment flows.
However, some countries have recently put in place capital controls and regulations to buffer their economies from foreign exchange volatility and capital flows. While such measures may serve legitimate purposes under exceptional circumstances, they could lead to a fragmentation of international capital markets along national lines, and may be difficult to dismantle once in place, says the report.
“Foreign exchange intervention is not the most helpful instrument for macro-economic management,” OECD Secretary-General Angel Gurría said. “It can prompt countervailing intervention and may trigger new protectionist responses.”
Besides steering clear of further intervention in currency markets, governments must also wind down emergency schemes as quickly as is prudent. Exit strategies should be transparent and accountable. While 12 G20 countries implemented emergency programmes for the financial sector, India is the only country to date that has fully dismantled them and retains no related assets or government guarantees.
view the Fourth Report on G20 Investment Measures
Source: OECD
Backlash against Fed’s $600bn easing
November 4, 2010--The US Federal Reserve’s decision to pump an extra $600bn into the economy has galvanized emerging market central banks into preparing defensive measures and sparked criticism from leading global economies.
The Fed’s initiative in response to rising concern about the weakness of the US economy, has fuelled fears of a sharp drop in the dollar and a fresh flood of capital inflows into emerging markets.
Source: FT.com
Wells Fargo Launches Fund Services Product Line
November 4, 2010--Wells Fargo Bank announced today the launch of a new Fund Services product line within its Corporate Trust Services to address customers’ fund administration needs. Wells Fargo Fund Services provides fund administration services including a full suite of back-, middle-, and front-office products and services to private equity firms, exchange traded commodities (ETC), commodity funds, hedge funds, fund of funds and the structured finance marketplace.
Jorge Villalba, a 12-year industry veteran recently joined Wells Fargo to lead the Fund Services Group. Tom Gandolfo is head of Sales. The team is based in Columbia, MD; Houston, TX; and New York City and leverages expertise across Wells Fargo, including seasoned trust and compliance professionals. Additional hiring is anticipated by year-end.
Source: Wells Fargo
Doing Business 2011: Making a Difference for Entrepreneurs
November 4, 2010--In the past year, against the backdrop of the global financial crisis, policy makers around the world continued to improve business regulation and empower entrepreneurs, according to Doing Business 2011: Making a Difference for Entrepreneurs.
The IFC–World Bank report, which ranks 183 economies on key aspects of business regulation for domestic firms, discloses that 117 economies carried out 216 regulatory reforms aimed at making it easier to start and operate a business, strengthening transparency and property rights, and improving the efficiency of commercial dispute resolution and bankruptcy procedures.
The report also pioneers a new measure showing how much business regulation has changed in 174 economies since 2005.
Highlights:
Kazakhstan took top honors for the most-improved business environment in 2009/10
Singapore leads the world in the ease of doing business for the fifth year running
About 85 percent of the world’s economies have made it easier for entrepreneurs to operate in the past five years
Source: World Bank Group
Impact of Regulatory Reforms on Large and Complex Financial Institutions-Postition paper
November 4, 2010--EXECUTIVE SUMMARY
Financial sector reforms are being considered to address the risks posed by large and complex financial institutions (LCFIs). The vast majority of global finance is intermediated
by a handful of these institutions with growing interconnections within and across borders.
Common trends that contributed to the recent global crisis included sharp increases in leverage, significant reliance on short-term wholesale funding, growth of off-balance-sheet activities, maturity mismatches, and increased share of revenues from complex products and trading activities.
view Impact of Regulatory Reforms on Large and Complex Financial Institutions position paper
Source: IMF
