More of this kind of back-and-forth exchange between the industry and industry observers (expressing views that are both positive and negative) is needed. The authors of the Report should take the SIFMA response as an opportunity to defend their work or add to it. The broad conclusions of the Report should encourage others to comment as well. An important goal is to avoid a situation in which open discussion disappears in the .

Notwithstanding the…

This is a thorough and practical report. Although it focuses on providing e-advisory services to customers, much of the discussion is equally relevant to firms that provide personalized advice to customers (e.g., the section that pertains to asking customers about their objectives and potential risks: different results can arise from identical situations). This report should be reviewed by anyone (broker-dealer or adviser) who is responsible for providing advice to customers – or for…

Notwithstanding Senator Warren's preference for a monolithic regulator (such as the Consumer Financial Protection Bureau), the Securities Exchange Act provides that members of more than one party must serve as Commissioners of the SEC. This reflects some level of tolerance on the part of Congress for a diversity of regulatory views. Senator Warren's attack on Ms. Peirce reflects the Senator's unhappiness about the possible confirmation of a policy-oriented intellectual who has…

If there were a Cassandra prize for recognizing the risks of central clearing, Professor Pirrong would win it. However, his observation that after the risk is recognized, the problem of dealing with it becomes political as well as economic is an understatement. Having invested so much reputational capital in boasting of the benefits of central clearing, the government is not about to say, "Whoops! Perhaps we overstated the benefits of clearing a little (or a lot)." A broader concern is…