The problem with just reinstating Glass-Steagall, she said, is that "you don't go after all these other institutions in what is called the shadow banking system, hedge funds and other financial entities that have too much power in our economy".
It recommends that the shadow banking system (hedge funds, OTC derivative markets) should also be subject to regulation.
Tougher curbs on the financial system, including hedge funds and offshore tax havens.
The prime minister called for offshore tax havens to be brought under global supervision and for bringing the "shadow banking system", including hedge funds, into the regulatory system.
The non-bank institutions that make up the "shadow" financial system — including hedge funds, pension funds, insurance companies, securitization vehicles, money market funds, and mortgage funds — are typically outside the regulatory perimeter or subject to oversight by less-powerful bodies, which means they could wind up being a source of broader financial vulnerabilities, she writes.
Since the Reagan revolution, these superfluous profits have fed corporate mergers and takeovers, driven the dot-com craze, financed the "shadow banking" system of hedge funds and securitized investment vehicles, fueled monetary meltdowns in every hemisphere and inflated the housing bubble.
Risk capital will reside outside the banking system, in hedge funds and private-equity firms, much more than before.The likes of Deutsche Bank, UBS and Credit Suisse have all unveiled strategies to cut their proprietary activities in illiquid markets and focus on high-volume "flow" businesses: for example, helping clients to manage exchange-rate and interest-rate risk.
The compensation system for hedge fund managers works like the one for racetrack touts.
In the event that it does not get the desired spread, Aschettino says he has a system to hedge a loss.
Risks that have been relatively contained to the fringe worlds of Bitcoin, Ethereum, Zcash, Monero and other fantastically-named cryptocurrencies, are reaching their tentacles into the broader financial system, one hedge fund at a time.
A good idea I heard from a large buy side client is to set up a jury duty system where Hedge Fund Managers and Mutual Fund Managers will be on the committee.
