Events

Guest Speaker: Professor Vincenzo Bavoso, University of Manchester

Title: Debt Capital Markets: Law, Regulation and Policy (OUP 2024)

This monograph deals with the law and regulation of debt capital markets. It explores in particular the role that they have in fuelling episodes of crises and financial instability and the central argument laid out in this book is that instability in financial markets - culminated with the global financial crisis of 2008 and resurfacing with urgency since 2020 - is the result of a process of transformation that started in the 1980s. The analysis in this book charts the evolution of debt capital markets and their growth propelled by the undisputed belief in the validity of neoclassical economics, and attendant assumptions of efficient markets. This orthodoxy in turn informed the changes that shaped, between the 1980s and 1990s, the regulatory edifice of capital markets. This book explains how this process of transformation and liberalisation led to debt capital markets -from bonds to more sophisticated forms of securitised credit- becoming uncontrolled engines of private debt creation, high levels of leverage, and inevitably, financial instability. Ultimately, this book contends that the regulatory reactions engineered after the global financial crisis of 2008 have not gone far enough in re-evaluating those underlying beliefs and assumptions, which in fact remain at the heart of current policies. As a result, debt capital markets remain the main locus of financial instability, as current episodes of turbulence indicate, and overall the financial system remains fragile and exposed to the most severe consequences of shocks.