Why Prime Brokers are Prime Suspects

Although Ukraine and emerging-market distress were the most frequently discussed topics around last week’s Bank/Fund meetings, two other high-impact issues were also top of mind.  One is the end of the international financial order as we’ve known it for decades; I’ll return to this shortly as well as in my forthcoming book.  The other to which I now turn is more immediate: commodity-market stress and what regulators will do to avert it if they can. I have heard a lot about a number of options, but I fear that regulators will do what they always do when trouble lurks:  double-down on banks under their thumb instead of flexing their muscles to govern nonbanks at the heart of the global financial infrastructure.