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December 5, 2007 Sign up Forward Archive Advertise News on the capital markets, securities and financial industry   Morning Bell    Investors' views vary on size of expected Fed rate cut While many investors say they believe a Federal Reserve interest-rate cut next week is a foregone conclusion, determining how big the cut will be and what accompanying statements will say has proved difficult. A number of varying factors have some investors expecting a quarter-point cut while others are anticipating a half-point cut. The Wall Street Journal (tiered subscription model) (12/5) Take a closer look at First Clearing. Clear Thinking isn't a catch phrase - it's how we approach business and relationships with clients. We offer a platform of products and services that will enable you to compete on a level playing field with any firm in the business. Call 1-800-727-0304 or visit www.firstclearing.com.   Video View    Fed may consider ways to increase credit to consumers, firms The Federal Reserve, which is expected to lower its main interest rate at its Dec. 11 meeting, may also cut its discount rate to encourage banks to lend to one another. Doing so would bring the gap between the two rates to a quarter-point, which some say would ease the stigma associated with borrowing at the discount rate. Bloomberg1/ClipSyndicate (12/5), Bloomberg (12/5)   Industry News  Experts debate best way to prevent financial meltdown While the turmoil in the U.S. subprime-mortgage market continues to affect banks, experts are debating the effectiveness of transparency in the market over changes to accounting rules. "I don't know that it is appropriate to expect regulation, regulators, and standard setters to essentially prevent the next restructuring or subprime mortgages," said Roel Campos, former Securities and Exchange commissioner. Reuters (12/5) Lenders, regulators near agreement on duration of rate freeze Regulators and lenders are looking at a five-year freeze on interest rates as a way to stop a flood of home foreclosures, Bloomberg reported. "Fixing the reset period is an important action, and it's good that everyone now seems to be pushing in the same direction," said Michael Barr, a professor at the University of Michigan Law School. Bloomberg (12/5) Record number of foreign firms delist from U.S. exchanges A committee of financiers and academics says the competitiveness of the U.S. public-equity market is on the decline as 12.4% of foreign companies have chosen to delist from the New York Stock Exchange this year. According to a new report: "Some believe this spike in foreign company delistings represents pent-up demand to leave, but this pent-up demand is itself a reflection of the unattractiveness of the U.S. capital markets." Financial News Online (U.K.) (subscription required) (12/5) Cuomo issues subpoenas in latest subprime blow New York State Attorney General Andrew Cuomo has subpoenaed several Wall Street firms for information related to the packaging and selling of debt tied to high-risk mortgages. Firms receiving the broadly written request included Merrill Lynch & Co., Bear Stearns Cos. and Deutsche Bank AG. The Wall Street Journal (tiered subscription model) (12/5) Commentary: Goldman Sachs' governance pays off Writing for the Financial Times, columnist John Plender explains how Goldman Sachs has been able to carry on relatively unscathed through the meltdown in the subprime-mortgage market while its rivals are coming apart at the seams. "Much of it is down to culture," Plender writes. "Until recently, Goldman was a partnership, which is one of the best risk-control mechanisms invented." Financial Times (free content) (12/4) Study: No U.S. recession in 2008 The U.S. economy will avoid a recession in 2008, according to a UCLA study. The study cited a wide range of factors, including a forecast that the housing slump will end by the end of next year and the elimination of 3 million manufacturing jobs earlier this decade, which leaves little room for further job cuts. "Be calm, my friends. Be calm," forecast director Edward Leamer wrote in the report. Los Angeles Times (12/6) Poll: 71% of Americans expect recession within one year: A solid majority of Americans expect a recession within the next year, according to a Bloomberg/Los Angeles Times poll. The percentage has risen steadily this year, reaching 71% in the most recent survey. More than half of the respondents feel the economy is doing poorly. Bloomberg (12/5) Other News Survey: Private equity's buyout boom is over The New York Times/Dealbook (12/4) WaMu bucks trend, keeps management in place The Wall Street Journal (tiered subscription model) (12/5)   Regulatory Roundup  Reform discussed as regulators struggle to remain separate In the face of opposition, some financial-services industry groups, including SIFMA, are calling for the merger of the SEC and the CFTC. Turf battles between the SEC and CFTC over which watchdog has jurisdiction over new financial products have been on the rise as products have become more sophisticated and less easily distinguishable between securities (regulated by the SEC) and futures (regulated by the CFTC). SIFMA says jurisdiction conflicts between the CFTC and the SEC have created "needless legal uncertainty as to the status of new financial products." Financial Times (free content) (12/5) Commentary: Lower rates, cut taxes to avoid recession Lowering interest rates and enacting a tax cut could avert a recession, Martin Feldstein writes in a Wall Street Journal commentary. The current 4.5% federal funds rate is not low enough to stimulate growth and not high enough to reduce inflation, he said. "Now is surely a time for such a two-part strategy of expansion," Feldstein said. The Wall Street Journal (tiered subscription model) (12/5) Other News Couple sentenced in Morgan Stanley insider-trading case Reuters (12/4)   Legislative Update  Congress not expected to find offsets for AMT patch Congress is unlikely to find the $50 billion over 10 years needed to pay for a patch to the alternative minimum tax. Members of both parties doubt there will be enough votes to approve tax increases that would offset the bill. The Washington Post (12/5)   Technology  SEC releases new tool for reporting, analysis The Securities and Exchange Commission rolled out a new taxonomy for Extensible Business Reporting Language this week to improve financial reporting and analysis. David Blaszkowsky of the SEC called the new tool "a tremendous boon to investors" because it facilitates access to information that would otherwise be difficult to find. eWeek (12/4)   Editor's Note  Do you think the federal government's response to the credit crunch will be effective? Check your inbox for the SIFMA SmartBrief Year-End Report Dec. 11 and 13. View the results of this poll in Part 2 on Dec. 13. Yes No   SmartQuote  If A is success in life, then A equals X plus Y plus Z. Work is X; Y is play; and Z is keeping your mouth shut." --Albert Einstein, German-born Swiss-American physicist     Subscriber Tools       Print friendly format | Web version | Search past news | Archive | Privacy policy Advertise Sales Account Director:  Abiy Bekele 212-450-7919 Download Media Kit   Read more at SmartBrief.com A powerful website for SmartBrief readers including: Industry Home Readers' Choice Search Archive Get this RSS Feed Publish your Press Release Download the SmartBrief Android app     SIFMA RSS Feeds       Recent SIFMA SmartBrief Issues: Tuesday, December 04, 2007 Monday, December 03, 2007 Friday, November 30, 2007 Thursday, November 29, 2007 Wednesday, November 28, 2007     Lead Editor:  Sean McMahon Contributing Editor:  Dave Copeland | Devlyn Ray     Mailing Address: SmartBrief, Inc.®, 1100 H ST NW, Suite 1000, Washington, DC 20005     © 1999-2011 SmartBrief, Inc.® Legal Information