Make Markets Be Markets Conference, March 3rd 2010

by: Rortybomb

So it’s good that financial reform is coming to a head this week, because it times well with what I and the rest of the Roosevelt Institute having been working on over the past 6 weeks. This Wednesday, we are hosting an event in conjunction with a report we are putting out for financial reform: Make Markets Be Markets.

One problem that’s been very obvious is that there’s a lack of clear necessary and sufficient conditions in the debate for financial reform. What needs to move, and at what point can we say “This financial reform bill is a good bill”? So Rob Johnson, myself and the rest of the Roosevelt Institute team decided to put out a report detailing each of the pieces of reform that are necessary along with some key ideas to keep in mind. Here is the pdf of the final report, and you can check out chapters online. Here’s the table of content:

Introduction – Robert Johnson and Joseph E. Stiglitz
The Doom Cycle – Peter Boone and Simon Johnson
Fannie Mae & Freddie Mac – Raj Date
Regulator’s Incentives – Richard Scott Carnell
Credit Rating Agencies – Lawrence J. Wright
The Broken Consumer Credit Market – Elizabeth Warren
Shadow Banking – Raj Date and Michael Konczal
Securitization – Joshua Rosner
Off-Balance Sheet Accounting – Frank Partnoy and Lynn Turner
Over-the-Counter Derivatives Market – Michael Greenberger
Resolution Authority – Robert Johnson

Though we aren’t marketing it this way, in my mind I was gathering a Justice League of financial reform when assembling this project – people who are the best at each of their topics. So Michael Greenberger, former Director of the CFTC with Brooksley Born, is on derivatives. Elizabeth Warren will make the case for Consumer Financial Protection, Josh Rosner will argue for securitization reform, Frank Partnoy on balance sheets, etc. We also get Simon Johnson to walk us through the Doom Loop of what happens if reform doesn’t happen, and Richard Carnell does a cool chapter where he talks about regulator’s incentives and how to best set up the architecture for good financial reform.

On Wednesday morning each of the writers are going to present their topics at the conference. I’ll be explaining how to fix the shadow banking sector (something Tyler Cowen has said isn’t being fixed by anything he’s read – eek!). It’s going to be on Bloomberg TV, and you can stream it online (I’ll post more details soon).

Following that, each of our ideas, and the topic of financial reform in general, are going to be critiqued by a panel including Joe Stiglitz, George Soros, Peter Solomon, Jim Chanos, Stanley Sporkin and Bowman Cutter. So a top notch mix of academic economists, government regulators, and people who’ve worked in financial markets giving an opinion on what is necessary for financial reform.

If this interests you, I hope you spread the work about the talk and the report. I think right now is a really crucial moment in financial reform, and whether or not we are going to do this all over again in 5-7 years, and I hope this give a little bit more momentum for real change to take place in our broken financial markets.

(Aside: Oh boy, public speaking. The last talk I was involved with was a code review of our random number generators. We ordered pizza and took breaks to read from Numerical Recipes. Also, just saying, 6th week here. The senior fellows at the Roosevelt Institute have to start bringing an umbrella to the office, cause I’m making it rain, policy wonk style.)

I’ll be posting some great stuff from the report over the next two days. I hope you check it out and tune in to the conference.