An Empirical Analysis of the Dynamic Relation between Investment-Grade Bonds and Credit Default Swaps

The Euro and the Battle of Ideas

If ever there were a biologic therapy most likely to be covered by a health insurer, it would be one for cancer. Unless an oncologic drug was being used off-label and with the potential for harm, it’s rare that a third-party payer would effectively block access to it if evidence suggested it could save the life of someone diagnosed with cancer. \n \n \n \n \n \nMICHAEL D. DALZELL \n \n \n \nBut with a year’s worth of an injectable oncologic drug priced at $50,000 or more, the cost to society is not sustainable. Payers are seeking creative ways to keep access open and to make ends meet all at once. \n \nThus, an old idea returns: The cancer carve-out. First touted in the early 1990s as a way to put care in the hands of specialists and mitigate financial risk, payers seemed to be headed that way before the managed care backlash relaxed tightly managed models of health care financing. \n \nIf the experience of mental health carve-outs taught us anything, then it was just as well the idea never advanced. The cost of care was the driving force there, too, but without education and care management components, carving out behavioral health ultimately inflated expenditures. Instead of patients flowing seamlessly to mental health professionals, many did not recognize their own need for behavioral health interventions and saw their primary care physicians for vague physical complaints. Their primary care doctors did the best they could, but often missed the psychiatric diagnosis. \n \nAs a result, MCOs paid twice for its members’ behavioral health care — a capitated rate to a carve-out company and another set of payments to a primary care physician and a pharmacy. Moreover, the carve-out company had no incentive to move toward a disease management focus or any other model that would encourage care coordination among providers. \n \nOf course, that was before the age of biologics. By their nature, biologic therapies are specialist-driven. Oncology always has been, too. This convergence lends itself to consideration of a new model of carve-out — one that encourages coordination of care, promotes disease management, and strives for positive clinical outcomes as the drivers of cost minimization. \n \nAs Katherine T. Adams reports in our cover story, that’s what is taking shape. Uptake will largely depend on whether a model evolves that seems workable, but a few concepts are emerging and payers are kicking the tires. In a country that spends one sixth of its gross domestic product on healthcare, any discussion of creative ways to finance this burden with a nod toward better clinical outcomes is certainly positive.

Everything old is new again.

World Federation Of Exchanges

Taking a text, cases and materials approach, de Luca's successful textbook remains the only offering for students of European company law, and has been thoroughly updated in this new edition. Chapters have been expanded to cover the latest legislation and directives on cross-border mergers, the use of digital tools, and cross-border insolvency, while figures and graphs have been introduced to help illustrate complex processes and relationships. Clearly differentiated explanatory textboxes from the first edition have been revised, and allow students to quickly identify sources such as EU legislation, official documents and excerpts from scholarly papers. The book explores a diverse range of topics, from what European company law is, to the structure of the Societas Europaea Statute, capital markets and takeover law. It continues to be an essential resource for the growing number of graduate courses in European company law, European business law, and comparative corporate law.

European Company Law

The origins of European capital market regulation can be traced back to the seminal Segre report in 1966. Over the intervening years there have been times of both significant regulatory change, specifically during the Financial Services Action Plan (‘FSAP’) period and again following the recent financial crisis, but also times of relative inactivity such as in the immediate post-FSAP period. This paper analyses the creation of the European capital market, and the regulatory and institutional reforms that have occurred in this context, particularly in the light of the recent crisis. Specifically, the financial crisis has prompted a major regulatory overhaul within the EU. In particular the legislative reforms have focused on greater centralisation of powers at the European level, increased and more intensive regulation, and an extension of the regulatory perimeter to capture a broad array of firms, instruments, and trading practices within the EU regime. The scale of change has been enormous, with the development of the ‘single European rulebook’ illustrating just how far the European capital market project has come. Nonetheless, it is also remains clear that regulatory reforms that represent a ‘knee-jerk’ reaction to a crisis tend to be poorly designed, and are rarely the changes that are required and it remains to be seen how well the rules will stand up in a future crisis.

https://papers.ssrn.com/sol3/Delivery.cfm/SSRN_ID2575717_code270509.pdf?abstractid=2575717&mirid=1

The creation of a European capital market

The European Securities and Markets Authority (‘ESMA’) was established over six years ago It, and its sibling bodies for banking, and the insurance and occupational pensions sector, emerged from the ashes of the crises, and the agencies have been the topic of much discussion in academic scholarship from a variety of perspectives This article provides a new situating of ESMA within the broader policy context Employing empirical observations, and rooting it within the related literature on supervisory governance (defined, broadly, as the supervisory practices and enforcement measures that contribute to governing the EU’s financial set-up), it explores ESMA’s pro-active use of its direct supervisory and enforcement powers, and uses this as a launching pad for reflecting on how EU supervisory governance is evolving Specifically, the article speculates that although ESMA is still at a relatively youthful stage with respect to its direct role, it is strengthening its reputation as a credible and pro-active supervisor, and is becoming an important driver with respect to the evolution of EU supervisory governance This article suggests that, over time, ESMA’s influence and approach could gradually result in the greater centralisation of supervisory governance at the EU level Linked to this, the article also speculates that any such shifts in this regard will continue to develop slowly, and over time, rather than via any seismic shift Further, although there are a number of barriers and constraints to ESMA’s operation, the article suggests that none of these are intractable

The evolution of ESMA and direct supervision: are there implications for EU supervisory governance?

In the EU, short selling rules were introduced in 2012 (the ‘Regulation’), largely as a consequence of the sovereign debt crisis. The influence of the crisis is evident in the Regulation, which restricts short selling in the sovereign debt markets, as well as the short selling of shares. In contrast, the US has had short selling rules in place since the 1930s. Following the financial crisis, although short selling regulation did not form a key priority on the international G20 reform agenda, the SEC subsequently implemented a number of new restrictions. This article analyses the choices made in both jurisdictions concerning short selling restrictions. Some similarities exist, but divergences are also evident, not least in the absence of constraints on sovereign debt in the US. Further, aside from the sovereign debt restrictions, the US rules are in fact more onerous than those in the EU. This article suggests that this outcome can, perhaps, be explained in part by political pressures brought to be...

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Short selling restrictions in the EU and the US: a comparative analysis

The European Short Selling Regulation not only restricts the short selling of shares but (largely in response to the European sovereign debt crisis) also extends its reach into regulating the sovereign debt market. In particular, the Regulation imposes a prohibition on entering into uncovered sovereign credit default swaps (CDSs): a functionally equivalent mechanism to short selling the underlying bonds. This paper provides an overview of sovereign CDSs and their uses and places the concerns voiced about sovereign CDSs in context through an analysis of the relevant economic literature. It then discusses the Regulation’s provisions in the light of these findings. The paper suggests that there are many benefits to using sovereign CDSs and little to support the accusations that developments in the sovereign CDS markets aggravated the sovereign debt crisis. The restrictions may also reduce interest in the underlying bond markets and so may in fact harm the sovereign issuers the provisions were designed to protect.

/pdf/regulatory-intervention-in-the-european-sovereign-credit-5efx08geoq.pdf

Regulatory Intervention in the European Sovereign Credit Default Swap Market

The conferral of powers on the European Securities Markets Authority (‘ESMA’) has involved tensions, particularly concerning the boundaries between national and EU powers. A case in point is the recently introduced European Short Selling Regulation: article 28 confers direct powers of intervention on ESMA in exceptional circumstances. Crucially, measures adopted by ESMA under article 28 prevail over measures taken by national regulators. Article 28’s adoption led to a UK challenge at the European Court of Justice seeking its annulment. However the court’s decision, delivered on 22 January 2014 upheld ESMA’s powers. This paper examines this landmark decision and suggests that while some important consequences result from it in relation to the development of the European Banking Union, the decision is disappointing, not least for its brevity and failure to fully engage with the Advocate General’s arguments. Further the judgment also paves the way for future developments in ESMA’s and other EU bodies’ roles, whilst limiting the possibility of future legal challenges. Finally, the court’s affirmation of the legislative view is also part of a more general and worrying trend that has been evident in its case law over the last decade.

https://papers.ssrn.com/sol3/Delivery.cfm/SSRN_ID2733538_code1925700.pdf?abstractid=2459815&mirid=3

Elizabeth Howell

Papers

The creation of a European capital market

The evolution of ESMA and direct supervision: are there implications for EU supervisory governance?

Short selling restrictions in the EU and the US: a comparative analysis

Regulatory Intervention in the European Sovereign Credit Default Swap Market

The European Court of Justice: Selling Us Short?