Sky Blog
The debate over asset managers’ potential systemic risk has been ongoing for some years, with little agreement between the industry, US regulators, and global standard setting bodies. US regulators themselves have been divided – the SEC has in particular been …
Bagehot, as in Walter Bagehot, was mentioned no less than seven times in the decision splitting the baby in the AIG trial.[1] A nineteenth century British commentator, Bagehot was among the first to recognize that too little liquidity could …
On May 4, 2015, the District Court for the Southern District of New York affirmed Bankruptcy Judge Robert D. Drain’s ruling confirming the chapter 11 plan of MPM Silicones, LLC. The holdings of the District Court and the Bankruptcy Court …
The AIG decision (actually, Starr International Co. v. The United States[1]) has shocked many but for the wrong reason. Some commentators have focused on the ingratitude of Maurice Greenberg, AIG’s former CEO and the “architect” of its international …
On May 4, 2015, Vice Chancellor Travis Laster of the Delaware Court of Chancery issued an opinion providing a thoughtful analysis of when the creditors of an insolvent corporation have the right to bring derivative claims, such as those alleging …
Law schools have become poster children for market dysfunction. As the Great Recession decimated the demand for new lawyers, a functioning market would have led most schools to reduce enrollments. Instead, the overall number of admitted students increased to more …
Last week, along with our co-authors Kate Andrias and Michael Barr of the University of Michigan Law School, we filed an amicus brief on behalf of fifteen professors of law and finance in MetLife v. Financial Stability Oversight Council. …
Law firms don’t just go bankrupt – they collapse. Dewey & LeBoeuf; Heller Ehrman; Howrey; Thelen. All of these firms and many others have disappeared with extraordinary swiftness and finality. Large law firms often go from apparent health to liquidation …
The Greek crisis emerged as an offspring of the financial crisis of 2007, the institutional and fiscal problems of the Greek economy, the institutional structure of the Eurozone and, crucially, the failed political management in the last months that led …
On March 22, 2013, the Board of Governors of the Federal Reserve System, Federal Deposit Insurance Corporation (“FDIC”), and Office of the Comptroller of the Currency (collectively, the “agencies”) published “Interagency Guidance on Leveraged Lending (78 …
Financial panics are pernicious, but they can be countered with government guarantees of panic-prone debt. In the wake of the crisis, however, Congress has stripped regulators of this sort of guarantee power, motivated in large part by concerns that such …
A watershed moment is coming for shareholder activism and corporate governance generally, as the proxy contest brought by Trian Management Fund, seeking effectively to break up DuPont, enters its final stages (with the vote being less than a month away). …
The last twenty-five years have brought about widespread changes in the organizational forms through which individuals organize economic activity. Once momentum built, the creation of hybrid entities such as limited liability partnerships, limited liability companies and even limited liability limited …
There is a buzz in the air concerning bankruptcy examiners. Recently in such cases as ResCap, Dynegy and Tribune, and perhaps now in Caesars, examiners have played a decisive role in resolving major chapter 11 cases that …
The Commonwealth of Puerto Rico’s efforts to deal with more than $70 billion in debt have been a magnet for media scrutiny during the last two years. A question frequently asked in connection with the island territory’s struggles to stay …
In the Great Recession’s morality play, unscrupulous financiers on the inside of the mortgage industry exploited ordinary folk on the outside. Predatory lenders pushed unsuspecting homebuyers into teaser rate mortgages that seemed affordable but were in fact ticking time bombs. …
It is an honor to speak at the Federal Reserve Bank of Atlanta’s 20th Financial Markets Conference, and I am grateful to President Lockhart and the organizers for inviting me to do so.[1] This evening I would like to …
Asymmetric information is an important characteristic of the securitization market, where products exhibit complex architecture and information about the underlying credit portfolio is highly opaque. In order to overcome these information asymmetries, issuers use rating agencies who act as agents …
The SEC staff issued a no-action letter recently that will allow some companies to refinance their debt using tender and exchange offers shorter than the 20 business days required in the tender offer rules. The letter extends to high yield …
Today we feature three posts on the theme of Fannie Mae and Freddie Mac. The first two posts — from David Min and Brad Miller, respectively — question assumptions about the proper role of government and markets in home …