What a Democrat-controlled SEC means for markets

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What a Democrat-controlled SEC means for markets

first_img– Advertisement – What would a Democrat-controlled Securities and Exchange Commission look like? It’s early, but speculation is already raging on Wall Street. Who will be the next SEC Commissioner?  Former CFTC chair Gary Gensler, who aggressively implemented Dodd Frank while CFTC Chair under Barrack Obama, is in charge of the review group for the Biden transition team on the Federal Reserve, Banking and Securities Regulators, which would include the SEC. There are no obvious choices, but given that Democrats are historically very aggressive on: 1) more regulation to protect consumers, and 2) aggressive enforcement of those regulations, some feel that it’s likely that a prosecutor-type would get serious consideration. – Advertisement – “Inspections and enforcement actions will likely increase, because they have not been very high under the current administration,” David Franasiak, an attorney with Williams & Jensen who specializes in corporate law, told me. Nick Morgan, a partner at Paul Hastings LLP and a former SEC senior trial counsel, told Law360 that “given [former US Attorney for the Southern District of New York] Preet Bharara’s history with President Trump, he seems a likely candidate.”Others agree that an “aggressive” candidate stood a good chance of approval.  “Maxine Waters is in charge of the House Financial Services Committee, and they (the Democrats) will look to her for regulatory guidance. I think she will be a swing vote in who gets appointed,” Pat Healy from Issuer Advisory Network told me, noting that he would expect her to push for a “very aggressive” appointment.What would the SEC priorities be?- Advertisement – “You will see more climate-related and ESG related policies,” Jim Angel, associate professor of finance at Georgetown University, told me. “They will look at ESG disclosures, like climate and risk disclosure — how much carbon and greenhouse chemicals are you putting into the air?”Indeed, expansion and standardization of ESG (Environmental, Social, and Governance) principles was the most commonly referenced priority when I spoke with SEC watchers. More involvement in corporate governance, climate change, worker pay, worker treatment, diversity, and health care.SEC Commissioner Allison Herren-Lee (a Democrat, who could be interim chairman as a new chair is considered) has recently argued that the SEC should consider standardized reporting by public companies and investment funds regarding climate risk. What does the SEC have to do with climate risk? In a recent speech to the Practicing Law Institute,  Herren-Lee argued that the SEC is tasked with protecting investors, facilitating capital formation, and maintaining fair, orderly and efficient markets. “Broadly, we must ensure that we work with fellow regulators to understand and, where appropriate, address systemic risks to our economy posed by climate change,” she said. “To assess systemic risk, we need complete, accurate, and reliable information about those risks,”  which starts, she says, with public company disclosure.She went on to encourage the development of more standardized disclosures around ESG in general.To many observers the requirement to “disclose” risks around climate change masks a broader agenda:  “What is the goal here?  Is it to get companies to disclose environmental risk, or is the goal to use disclosure requirements to require companies to take climate action?” one longtime SEC observer, who asked to remain anonymous, told me.Another longtime SEC observer, who also asked to remain anonymous, echoed that sentiment:  “Disclosure is used as the hook. The way this is advanced is, ‘Oh, it’s just disclosure.’ And then if you don’t have a policy around, say, climate change or diversity, it becomes a shaming exercise for companies that don’t have procedures that fit with a certain line of thinking.”“These are matters not germaine to the SEC,” the same person went on to say.  “They are trying to bootstrap social agenda items into investor protection and disclosure, but it’s not the SEC’s role to solve these problems.”A bigger push for public markets?The SEC has recently moved to make it easier for some people to invest in private companies. Tyler Gellasch, executive director of Healthy Markets, said the Dems will likely try to pull more companies — particularly large ones that have remained private for years — into the public markets.“The SEC has been aggressive in expanding the pool of private markets, making it easier to raise money,” he told me. “A huge part of the market has gone dark, in private equity hands. The Democrats would likely try to reverse those trends, they would say, once you are a big enough company, you should be a public company. You can’t go through an endless round of fundraising to stay private.”Regulation Best InterestRegulation Best Interest, known as Reg BI, was a 2019 rule that required broker-dealers to only recommend financial products that were in their clients’ “best interest,” but not require that they act as fiduciaries. That did not sit well with Democrats. “They don’t describe a fiduciary standard, but they [the Democrats] would likely make everyone including brokers a fiduciary,” Franasiak told me.“The big fight is likely over compensation schemes,” Angel told me. “The pro-fiduciary crowd [the Democrats] basically wanted to eliminate sales commissions, and said advice should either be charged by the hour, or as a percentage of assets under management. The anti-fiduciary crowd didn’t want to change anything, and realized that any new regulations would increase their compliance costs.”Shareholder Proposal RuleThe SEC also recently adopted new rules for shareholder proposals. Under the old rule, a shareholder was required to have continuously held for one year at least $2,000 in market value, or 1% of a company’s voting securities, to be for inclusion in the proxy materials.The new rule requires a shareholder to have continuously held voting securities with the following market values for the following periods:$2,000 for at least three years;$15,000 for at least two years;$25,000 for at least one year.“The shareholder proposal rule is right up there with some of the regulations the Democrats would like to roll back,” Chris Nagy, president and founder of KOR Trading and also with Healthy Markets, noting that both Democratic commissioners dissented from that proposal.Don’t expect quick changesThose expecting quick movement on a new chairperson are likely to be disappointed, Nagy said. “Don’t look for immediate appointment of a new Chairman,” Nagy said. “The Republicans will not want to have a quick nomination early.  Right now [assuming Chairman Clayton resigns] you have a 2-2 Commission, so if you had a Democratic Chairperson appointed you would have a 3-2 SEC Commission, with Democrats in the majority. The Republicans want to drag that out as long as possible.”Subscribe to CNBC PRO for exclusive insights and analysis, and live business day programming from around the world.center_img – Advertisement – An exterior view of the U.S. Securities and Exchange Commission (SEC) headquarters in Washington.Jonathan Ernst | Reuterslast_img read more

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Solskjaer convinced Man Utd will not repeat Everton horror show

first_img Read Also: Odion Ighalo ready to partner Anthony Martial in Manchester United’s attack “We have missed that box opener that Bruno (Fernandes) is proving to be now.” Solskjaer again praised Fernandes over the impact he has made since his arrival at Old Trafford, saying he had been a “big boost” for the team. “He just loves football,” he said. “He’s got so much enthusiasm and smile about him.” FacebookTwitterWhatsAppEmail分享 Ole Gunnar Solskjaer is confident that Manchester United will not repeat last season’s embarrassing “capitulation” against Everton as they seek to strengthen their push for a Champions League place. Bruno Fernandes has impressed since arriving at Manchester United in January United make the short trip to Goodison Park on Sunday in an upbeat mood after seven games unbeaten – and six clean sheets – in all competitions. On Thursday they progressed to the last-16 of the Europa League after a 5-0 win at home against Club Brugge gave them a 6-1 win on aggregate. Solskjaer endured what remains his most chastening day in the hotseat last April at Everton, apologising to fans after a 4-0 rout as their season unravelled. “That was the lowest I’ve been,” Solskjaer said, referring to the Everton defeat. “I think you all know that and remember that. That was a capitulation. “We had absolutely nothing about us, even though their goals were more or less counter-attacks from set plays and long throw-ins.” The Norwegian said he was certain his side would produce a better performance on Sunday. “I can with hand on heart 100 percent say these boys will never give in and never give up like that team did,” he said. “These are the boys we want to build the next team around.” Of that starting line-up, Chris Smalling has left on loan, Phil Jones has barely featured and Paul Pogba has seen his playing time heavily restricted by injuries. Romelu Lukaku is the only starter that day to have left permanently. United at last appear to have found some consistency and confidence after a bumpy season but Solskjaer said he knew it would take time. The January arrival of Portugal midfielder Bruno Fernandes has lifted the team, who are fifth in the Premier League table, three points behind fourth-placed Chelsea. “We knew when we made the decisions we made in the summer it was going to take time,” said Solskjaer. “As I’ve said a few times, Rome wasn’t built in a day. “The culture, the attitude, the fitness, the camaraderie, the team spirit and maybe even the understanding between players have improved. Loading… Promoted ContentBest & Worst Celebrity Endorsed Games Ever Made13 kids at weddings who just don’t give a hoot10 Inventions That Make Us Question Humanity10 Of The Best Places Around The World To Go StargazingBirds Enjoy Living In A Gallery Space Created For Them18 Beautiful Cities That Are Tourist MagnetsThe 18 Most Visited Cities In The World9 Facts You Should Know Before Getting A TattooWho Is The Most Powerful Woman On Earth?Top 10 Most Romantic Nations In The World10 Legendary Movies To Learn History From6 Extreme Facts About Hurricaneslast_img read more

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Pascoe: Balotelli deserved his goal

first_imgLiverpool assistant manager Colin Pascoe believes Mario Balotelli fully deserved his first Premier League goal which crucially gave them victory over top-four rivals Tottenham. Lazar Markovic had given Liverpool an early lead, which was cancelled out by Harry Kane’s 23rd of the season. Daniel Sturridge, on his first start for five months, won the penalty for Steven Gerrard to equal Robbie Fowler’s club total of 183 but that was cancelled out by Mousa Dembele’s close-range effort, only for Balotelli to have the final say. “I think that it was a great game,” said Spurs boss Mauricio Pochettino. “I am disappointed and at the same time proud of the effort of our players because it was great but in football you have to be lucky to get the points and today I think we were unlucky. “I think maybe we gave the opportunity to Liverpool in the first half more than the second. “We gave many balls away – easy balls to play – and Liverpool got the ball and played on the counter-attack. “That was a little bit disappointing but I think the performance was good and we played to win the game. “I think it is a shame. We deserved a little bit more.” “Mario always works hard in training and recently he has been ill and he has had some knocks on his foot where he couldn’t get his boot on,” said the Welshman, standing in for Brendan Rodgers who had left to board a flight to Europe to watch a match tomorrow. “It is testament to himself, he kept going and got his reward.” Considering he had waited all season for the goal, Balotelli did not look particularly pleased with his effort. There was no celebration and straight after the final whistle he headed off down the tunnel without shaking hands with team-mates or opponents, or acknowledging the fans who still back him despite his disappointing campaign. “He is immensely happy. To get a winner at Anfield, I am sure he is happy. Again, with Mario he knew he would have a part to play and he certainly did,” added Pascoe. The victory was vital to Liverpool’s Champions League ambitions as it moved them within three points of third-placed Southampton, who have a match in hand, and Arsenal in fourth. “We needed to win tonight to get closer to the top,” said Pascoe. “We always thought that. Our next (league) game is Southampton and we will look at that to get three points and keep closing the gap.” The sides were locked at 2-2 with seven minutes remaining when the Italy international converted Adam Lallana’s cross. Balotelli had been left out of the previous three squads after a woeful substitute performance at Chelsea in the Capital One Cup semi-final but Pascoe said the goal was just what he needed. Press Associationlast_img read more

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