Securities Regulation in the Interconnected, Global Marketplace

The world’s capital markets are indisputably global and interconnected. A couple of quick metrics make the point: as of 2015, U.S. investors held nearly $9.6 trillion in foreign securities, and foreign holdings of U.S. securities were over $17.1 trillion. Consider as well single-name CDS activity—a truly global market where over $7 trillion dollars in notional value was outstanding at the end of 2015: only 12 percent of global transaction volume was between two counterparties located in the U.S., while 48 percent was between one counterparty located in the U.S. and the other located abroad. Witness also the financial crisis when the collapse of the markets for certain products cascaded throughout the global financial system, gravely impacting many interconnected financial institutions, and then all of the ensuing efforts to take measures, both domestically and internationally, to prevent a recurrence.