Description

U.S. securities markets have been changed by strong social, technological, economic, and political trends over the past two decades. During the 1970s automated systems were put in place, institutions emerged as dominant investors, new kinds of financial instruments began to trade, and Congress passed landmark legislation encouraging greater competition among markets. In the 1980s securities and futures markets became linked through new financial products and computer-assisted trading strategies. The decade of the 1990s will bring still greater challenges for the markets, their regulators, and congressional oversight committees, as foreign competition becomes intense and electronic trading systems mature.

The world is moving toward electronic around-theclock and around-the-globe securities trading. These challenges will require strong efforts to maintain efficiency and fairness and to meet the needs of domestic and foreign investors. The ability of U.S. markets to compete with foreign counterparts is becoming critical. The U.S. regulatory structure will have to maintain and protect essential domestic policy objectives in an environment buffeted by change. The regulatory structure, designed for yesterday’s markets and assets, may not be up to tomorrow’s tasks. New or revised legislation may become necessary. The private sector cannot achieve, without government assistance, some of the necessary adjustments to keep American markets strongly competitive and to protect American investors and financial systems.