Regulatory action taken on short-selling around the world was needed.
The intervention by the various regulatory bodies around the world in regard to short-selling practices was justified, according to regulators at an Australian Securities Exchange (ASX) presentation.
The consensus was that the action has not had a damaging influence, and that natural market forces could not be left to rectify the situation.
"Clearly there has been an emergency that needs dealing with... it is hard then to quarrel for the need for some emergency action and it is obviously a delicate and difficult thing to do," NYSE Regulation executive vice president and general counsel James Duffy said.
"I think at the very least it is something that gives us a pause... to allow market participants to react calmly," he said.
ASX chief supervision officer Eric Mayne agreed regulatory action needed to be taken, and it was better for the authorities to do something as opposed to nothing.
"I think it is better to make a call and take action and then to get feedback and react to that, than perhaps just letting a catastrophic situation exist," he said.
The regulators do, however, need to be mindful of the impact their actions will have, according to Hong Kong Exchanges and Clearing head of risk management Kevin King.
"It is about understanding cause and effect, and from the risk management perspective it is that anticipation of the scope and the speed of that effect," he said.
In response to a question about why regulators tend to be reactive, Duffy said a lot of the issues that eventually have to be dealt with are unknown factors.
In Part 2 of our exclusive series, we ask leading names to nominate their best investments, the most effective industry group and the importance of platforms.
A former colleague of mine once offered the opinion that industry superannuation funds are reconstructed socialists - despite their union influence, these funds have grown and benefited from a global capitalist world.... read more »
Home delivered!
Daily news, weekday mornings
Get the day's news delivered direct to your inbox. Register here (it's free!) and choose 'yes' to receive the InvestorDaily newsletter.
Catholics revamp fixed interest »
Industry superannuation fund the Catholic Superannuation and Retirement Fund (CSRF) has revamped its fixed income portfolio.
Mercer backs alternatives »
Mercer has awarded $34.15 million in mandates to Tactical Global Management (TGM) and Lazard Asset Management to invest in alternative assets.
Here we go again. Unlike this time last week, we have little to focus on happening overseas to propel us out of these financial doldrums.... read more »
