Sky Blog
If you google “Lithuania e-money,” the auto-fill function will suggest that you search for ”Lithuania e-money license.” If you accept the tip, the first result will be Ecovis, which describes itself as “the most experienced finance institution and FinTech licensing …
Securities class actions may deter financial misreporting and flawed disclosure, but how effective are they at deterring managers from taking actions that sacrifice long-term value for higher profits? In a recent paper, we uncover a novel mechanism that extends the …
How has the U.S. Tax Cuts and Jobs Act of 2017 changed corporate behavior? In addition to reducing the corporate income tax rate to a flat 21 percent from a high of 35 percent, the TCJA changed other important rules …
It is widely accepted among investors that compensation committees should align executive pay with performance in part by using incentive metrics that contribute directly to shareholder value. For this reason, it is common for incentive metrics to overlap with performance …
Global financial markets are preparing for the phasing out of the London interbank offered rate, or LIBOR, with the loan, derivatives, securities, and bond markets most affected. As of mid-2018, about $400 trillion worth of financial contracts referenced LIBOR in …
On December 22, 2017, President Trump signed the Tax Cuts and Jobs Act (TCJA), which is the largest gross tax cut in American history (cutting more than $5.5 trillion in taxes over 10 years); the act took effect on January …
On September 25, 2019, the US House of Representatives (“House”) passed, by a vote of 321 to 103, the Secure and Fair Enforcement Banking Act (“SAFE Banking Act”), bipartisan legislation designed to secure and regulate banking services to the expanding …
The rise and fall of The We Company IPO bubble is one of those events that, like the subprime mortgage bubble that preceded the financial crisis, calls for an examination of market structures that could have produced such a precipitous …
Benchmark Capital partner and legendary tech investor Bill Gurley recently declared on CNBC, “It took me two decades to figure this out, but I think Silicon Valley’s been on the bad end of a bad joke for about four decades …
Faced with pressures from varied constituencies, compensation committees striving to demonstrate links between pay and performance regularly consider market-based performance measures such as relative total shareholder return[1] (RTSR). Companies reviewing the mix and designs of their long-term incentives (or …
U.S. public company audits all include a simple step to determine whether an amount is large or significant for their clients, otherwise known as materiality. This decision influences the planning and procedures of the other facets of the audit as …
In general economics, “asymmetric information” refers to information about a transaction in which one party knows more than another party, to the potential benefit of the former at the expense of the latter. An example often occurs when consumers and …
Since the 2008-2009 financial crisis, scholars, regulators, and policymakers have engaged in extensive studies to try to control excessive risk-taking by systemically important financial firms. In a recent article, available here, I argue that those studies do not fully …
How does the stock market respond to news reports about a company? Previous work has found that it takes a few days for prices to fully absorb news, and this underreaction has been attributed to investors’ limited ability to process …
In a recent paper, I review the literature on fintech and its interaction with banking. Included in fintech are innovations in payment systems (including cryptocurrencies), credit markets (including peer-to-peer or “P2P” lending), and insurance, with blockchain-assisted smart contracts playing a …
As a matter of abstract financial-economic theory, the cost of equity is straightforward. It is the minimum expected return investors require to hold the firm’s equity at the current price. Financial economists may disagree on the best way to estimate …
Initial coin offerings (ICOs) are a new form of fundraising whereby blockchain-related ventures raise public capital in exchange for newly issued digital tokens. The issued tokens may represent a variety of rights, ranging from financial rights – such as dividend …
The Financial Action Task Force (FATF), the inter-governmental body that sets international standards for anti-money laundering (AML) and countering the financing of terrorism (CFT), released a highly anticipated interpretive note and guidance on June …
Many issuers have doubts about the efficiency of the IPO market, despite post-2008 regulations designed to reduce conflicts of interests and the costs of going public. As a result, fewer companies are choosing to be listed, and many of those …
There has been a growing debate among politicians and policy makers, both at the state and federal levels, about the impact of taxes on investment, growth, and firm value. The focus has been predominantly on corporate income tax cuts because, …