2008 has been a tough year for the financial markets. In the last 12 months we have battled through the credit crisis and experienced a series of shocking events which have already instigated a need and a desire to transform the structure of the financial markets and post-trade processing.
We may still be in a state of shock, but a new year means a new start.
Here are some of the New Years Resolutions submitted by DerivSource members. Some are serious and others not so much…
Resolutions for ‘09
Sell side
1. I must not originate illiquid structured products
2. I must include better stress tests in my risk scenarios
3. I must not pay bonuses in cash
4. I must learn a new dance, the redun-dance
5. I must open a retail savings division and take as many deposits as possible
6. Back to basics
Buy side
1. Must avoid relying on a single prime broker
2. Must avoid buying structured products from those dealers
3. Must keep calling the Lehman liquidators and get our collateral back
4. Find a way to stop redemptions
6. Find a new way to make money
Regulators
1. Understand structured products
2. Learn about risk management
3. Learn about oversight, especially funds run by Mad-off people
4. Consider merging with the ‘other’ US regulators
5. Keep lobbying Washington, Obama wants change, we can give him change
6. What are those OTC products anyway?
7. Don’t create new legislation that will damage thriving business sectors
Industry
1. Survive!
Of course, market participants have already agreed to a set of collective goals. In the Oct 31st letter to the Federal Reserve extended the commitment made by major market participants, including the industry associations, broker/dealers and large buy-side institutions to include more goals for streamlining the back-office processing. But many of the deadlines for these goals outlined in the previous letter (July) have already passed. I assume more deadlines will be missed in ’09 but some of the objectives outlined will be met in due time.
Have your own resolution to add to the list? Sign in first to submit your comments.
