No new regulations are needed to protect the economy from risks associated with hedge funds and private equity, according to a study by U.S. regulators.
The report – signed by the heads of Treasury, Federal Reserve, Securities and Exchange Commission and Commodity Futures Trading Commission – suggests that “market discipline” and adherence to a series of nonbinding principles will provide adequate safety for investors, markets and the global economy.
“Too often, regulators reach immediately for new laws or rules which can have the unintended consequence of stifling innovation or smothering markets,” says Micah Green, co-CEO of the Securities Industry and Financial Markets Association.