Liberalism and Regulation of Financial Market

366
DOI: 10.20542/0131-2227-2012-9-20-30

V. Milovidov, MGIMO University, 76, prosp. Vernadskogo, Moscow, 119454, Russian Federation (vmilovidov@hotmail.com).

Abstract. Reagan's financial sector deregulation became a starting point for the financial engineering, derivatives, combinatory financial operations industry. Due to it hedge funds developed, and a range of risk financial transactions expanded among the banks that found both new forms of financial risk hedging and new sources of income: arbitrage and hedging, credit default swaps, operations with "second-rate” credits. It was them that exploded the market in 2007–2008. The reaction of states realized in a string of regulation initiatives, including creation of supranational coordination bodies (in particular, Financial Stability Board); reformatting of mega regulators and on their base – the shaping of state prudential supervision and financial services consumer rights protection bodies with different tasks; restrictions on hedge funds activities; toughening of derivative instruments regulation and implementing of a central counterparty institute on derivatives market.

Keywords: financial market, state regulation, liberalism, self-regulating organizations, crisis, Russia, USA


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For citation:
Milovidov V. Liberalism and Regulation of Financial Market. World Eonomy and International Relations, 2012, no. 9, pp. 20-30. https://doi.org/10.20542/0131-2227-2012-9-20-30



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