Experience Stern | News & Events

One year after the signing of the Dodd-Frank financial regulation reform legislation, regulators and market watchers say there are still a lot of hurdles to overcome to avoid another financial meltdown.

Excerpt from The New York Times Economix blog -- "Recent reports of the bleak jobs outlook for the United States brought to mind an eye-opening report for the Council on Foreign Relations by Michael Spence, a Nobel laureate, and Sandile Hlatshwayo. I highly recommend that report, at the very least its summary, “Globalization and Unemployment,” in the current issue of Foreign Affairs. It clearly explains our current dilemma in the labor market."

At the one-year anniversary of the Dodd-Frank Act, the NYU Stern Systemic Risk Rankings, launched in April 2010 by New York University Stern School of Business, shows that systemic risk has been reduced by 18% since July 2010. The ranking, a weekly rating and ordering by level of risk that the largest U.S. financial institutions bring to the financial system, measures the potential severity (but not the probability) of a systemic financial crisis, were one to occur. The measure shows that systemic risk has been reduced from $750 billion a year ago to $615.6 billion today.

Excerpt from US News & World Report -- "Christina Fang, a professor of management at NYU's Stern business school, tracked the Wall Street Journal's Survey of Economic Forecasts to find out how accurate these highly paid analysts' forecasts were when billions of dollars were at stake. Surely this would lead to more accurate predictions. Her paper, "Predicting the Next Big Thing: Success as a Signal of Poor Judgement," draws some stunning conclusions."

Excerpt from The Huffington Post -- "We are missing the lesson of the current British outrage over Murdoch just as we missed the lesson of the financial crisis in America."  Additional coverage appeared on GlobalResearch.ca.

Excerpt from BBC News -- "But economics Professor Nouriel Roubini, from New York University's Stern School of Business, said although the summit called Greece's debt restructuring an exceptional case 'a year from now Portugal and Ireland will need the same debt relief.'"  Additional coverage appeared on Market Oracle, Guardian.co.uk, TheTrumpet.com and Economic Times.

New York University Stern School of Business celebrates the five-year anniversary of delivering its top-ranked Langone Part-time MBA Program in Westchester. Responding to the need for flexibility among working professionals pursuing an MBA on a part-time basis, NYU Stern began offering classes at the SUNY Purchase campus in Westchester in September of 2006.

Excerpt from Knowledge@Wharton -- "According to Nouriel Roubini, an economist at New York University's Stern School of Business, the major risks to the U.S. economy include 'deleveraging of the household sector, high unemployment, a housing double dip, state and local government problems, and gridlock in Congress.'"

Excerpt from The Huffington Post -- "Surviving institutions are likely to be stressed themselves in the event of a crisis," Thomas F. Cooley, an economics professor at the New York University Stern School of Business, said during a panel discussion on the financial reform law last month. And the fact that companies may be forced to pay up after the fact "may encourage them to take additional risk," he said.

Excerpt from Xinhua -- "Today, Murdoch basically said that I’m here to stay and I’m the best person to fix these problems. That may indeed work for the short run but his appearance also today showed a lot of people that this is an 80-year-old man and we lose control of some of our faculties over time and it may indeed come back to haunt him that he made that personal appearance and there may be some questioning on the part of a number of financial stakeholders, board members even whether it’s time for Rupert Murdoch to step aside."

Excerpt from VoxEU.org -- "The sovereign-debt crisis spreading through Europe is threatening the existence of the single currency. Meanwhile in the US, debt has been a problem for many states without threatening the US itself. This column proposes a way of preventing future crises in Europe by learning how policymakers in the US achieve fiscal prudence without loss of sovereignty."

It is widely believed that a diversified hedge fund portfolio strategy is an effective hedge against adverse market movements. New research by NYU Stern Finance Professor Stephen Brown, with co-authors Greg Gregoriou and Razvan Pascalau of SUNY College at Plattsburgh School of Business and Economics, shows this is not the case: well-diversified funds of hedge funds are more sensitive to risk than is the average hedge fund in extreme market conditions.

Excerpt from The New York Times DealBook blog -- "Not only do funds of funds with more than 20 underlying managers begin to lose the benefit of diversification, they are also more exposed to tail risk events (or highly unlikely, devastating occurrences), according to the study, led by Stephen Brown, a finance professor at New York University’s Stern School of Business."  Additional coverage appeared on BNN, Professional Services Close-Up and Infovest21.

Excerpt from Project-Syndicate.org -- "The eurozone crisis is reaching its climax. Greece is insolvent. Portugal and Ireland have recently seen their bonds downgraded to junk status. Spain could still lose market access as political uncertainty adds to its fiscal and financial woes. Financial pressure on Italy is now mounting."  Additional coverage appeared on a Forbes.com blog, Aljazeera.net, Sunday’s Zaman, Social-Europe.eu, TodayOnline.com, Profittimes.com, Slate.com, Korea Herald and GuruFocus.com.

Excerpt from Financial News -- "This summer, the financial cognoscenti have begun speculating on who Tim Geithner’s replacement will be as US Treasury secretary."

Excerpt from Bloomberg -- "Italy needs a new government of technocrats to weather the financial-market storm because Prime Minister Silvio Berlusconi’s Cabinet has lost the confidence of investors, economist Nouriel Roubini told la Repubblica."  Additional coverage appeared on La Repubblica and San Francisco Chronicle.

Excerpt from Investment Weekly News -- "We examine the role that analysts play in a firm's choice of underwriter using a sample of major United States investment banks."

Excerpt from Bloomberg -- "'Guaranteed to Fail' by Viral V. Acharya, Matthew Richardson, Stijn Van Nieuwerburgh and Lawrence J. White (Princeton). Four professors at New York University’s Stern School of Business explain how Fannie Mae and Freddie Mac got so big and why we must fix them."

Excerpt from Bloomberg -- “The problem is exacerbated when Wall Street reacts and the stock moves too much,” said Susan Stehlik, a professor at New York University’s Stern School of Business. “That stock ticker can be as dramatic as an EKG or cholesterol test for some people.”  Additional coverage appeared in the San Francisco Chronicle.

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Excerpt from Forbes.com -- "A few months back the folks at Dow Jones Indexes hosted a get-together to celebrate the Dow’s 115th anniversary, and one of the speakers was Professor Richard Sylla from NYU. Sylla discussed the Dow’s history, and featured a slide revealing just what came of the 12 original components selected by Charles Dow back in 1896."  Additional coverage appeared on Yahoo! News.

Excerpt from Bloomberg -- “If the M&F board decides to put up the ‘for sale’ sign, then it has to be guided by Revlon,” Roy Smith, a finance professor at New York University’s Stern School of Business, said in an e-mail message.

Excerpt from Nightly Business Report -- "Companies tend to do the reverse stock split because their prices are low. Why are their prices low? Because they`ve been having poor earnings. So, unless they can change things around dramatically, it`s not going to go back up."

Excerpt from The Huffington Post -- "Frances Milliken did a marvelous study comparing how those in power think and communicate differently from the rest of us. They're more optimistic, prepared to take bigger risks and think in more abstract terms. And the more cut off they become, the more certain they are that they are right."

Excerpt from the New York Daily News -- "The stock market will tank, which will damage everyone's portfolio and/or pension fund," White said. That's what happened when Congress initially failed to pass the TARP legislation in Oct. of 2008, White noted.  Additional coverage appeared on Zeit Online and PolitiFact.com.