Global Pricing Forum New York Morning Round-Up
An early start for the Global Pricing Forum team, as we interviewed Todd Reynolds, Head of U.S. High Yield and Loan Pricing at Thomson Reuters, and Kristin Swenton, Business Development Director of Thomson Reuters, among other before the delegates began to arrive at the Pierre Hotel.
Jon Robson, President of Enterprise at Thomson Reuters, spoke to "the new frontier of market intelligence," the industry is moving towards, adding that "information can mislead. It needs to be trusted again; reliably sourced, intelligent information." Shortly afterwards Michael Chertoff, co-founder of The Chertoff Group and former Secretary of the Department of Homeland Security, delivered his keynote. He told the audience that "cyber crime needs to be tackled and tackled with government progress and private sector investment… it affects trust in the internet as a commercial platform which can be detrimental to its use." We will be bringing you an exclusive interview with Chertoff in the coming days.
The first of our panel discussions, touching on Investment Strategies, saw a great deal of speculation about where the markets are heading. Jayme Fagas, Global Head of MBS & ABS Pricing Reference Data at Thomson Reuters, made the point that "Investors, all market players, want to understand more about securities and how they're priced," addressing for the first time what seems to be one of the key threads of the debate - transparency. Gyan Sinha, Partner/Portfolio Manager at KLS Diversified Asset Management, reflected that "we were swimming in information going into the crisis, but it didn't help anyone. It's not just quantity of information, it's quality; disclosure might not necessarily help that, but the steps are good and in the right direction."
The transapency theme remained prominent throughout the morning. In the second panel, addressing Best Practices in Pricing Operations, Managing Director of Alternative Investment Services at BNY Mellon Marina Lewin told delegates that "what we've seen coming out of this crisis is clear definition of documentation, from the beginning of a fund." Her statement was echoed by Eric Reichenberg, Global Director of Valuations at GlobeOp Financial Services, who said that "the key is trying to create processes that are efficient in revealing true price discrepancies."
The morning sessions came to a close with a panel discussion about Analytics and Technology Development, and transparency, quality and timeliness were the key issues tabled for delegates. Seth Silverstein, Executive Vice President of GMAC Capital Markets, said of the 2008 crash "We had a perfect storm, the models didn't cover all the scenarios that could have happened, and then happened." Russ Parentela, Managing Director at BNY Mellon added "what the models didn't take into consideration was the data going into that was fraudulent, and - as the saying goes - garbage in, garbage out. Now we have to go deeper into checking, additional steps in loan validation are necessary."
We'll be back with more highlights from the afternoon sessions later today. Remember, you can keep track of the latest updates by visiting our live commentary feed, and we'll be publishing highlights, interviews and poll results from the Global Pricing Forum New York over the next ten days.