Valued at around $10 trillion, the U.S. corporate bond market is slow, expensive, and inefficient. This Article argues that the bond market – premised on contract – rests on a flawed regulatory design that delivers neither investor protection nor market quality.
While algorithmic trading now dominates financial markets, some exchanges continue to use human floor traders. On March 23, 2020 the NYSE suspended floor trading because of COVID-19. Using a difference-in-differences analysis around the closure of the floor, we find that floor traders are important contributors to market quality.
Using tax data, we compare the investment behavior of public and private firms for a representative sample of all U.S. corporations. We find that while both types of firms invest similarly in physical capital, public firms out-invest private firms in R&D.
Homeowners face risk due to variation in annual property tax liabilities which may result in financial distress and eventual mortgage foreclosure. We show that an unintended consequence of a common property tax feature, assessment limitations, exposes households to more systematic risk despite decreasing the variance of property tax payments.
We use the Federal Reserve’s Secondary Market Corporate Credit Facility (SMCCF) to examine whether secondary market liquidity has real economic effects.