Plumbers and visionaries. Settlement of securities transactions and the European financial market

Author: Peter Norman
English.: Plumbers and Visionaries: Securities Settlement and Europe's Financial Market
Sync by honeybunny: Olga Antonova
PublisherMann, Ivanov & Ferber

Pages: 528 pp.
Format: 70×100/16 (167×236 mm)
Circulation: 3000 copies.
Binding: Hardcover 

Chronicle of the formation of a common securities market in Europe

What this book is about

- About how the processes of integration went;
- How new products appeared on the market;
- How the old mechanisms were no longer able to meet the needs of the market;
- How problems arose that led to crises;
- How market participants looked for and found new, more effective solutions;
- And about many other things that make up and accompany a complex, in some places confusing, but very interesting mechanism called the "securities market.

Who is this book for

For everyone involved in finance, especially those who are interested in securities.

From the author

No matter what you say, 450 trillion is a lot of money. It's hard to comprehend a figure with 13 zeros after the forty-five.

If the euro symbol were put in front of 450,000,000,000,000, the sum would be nearly 40 times the GDP of all 27 member states of the European Union. If this amount were used to build a tower of €1 pennies, it would soar to 1.05 billion kilometers, seven times more than the distance from the earth to the sun. If it were divided among all the inhabitants of the European Union, everyone, including women and children, would receive € 920,000.

This mind-boggling sum is the annual turnover of a group of companies headquartered in an obscure office center in Brussels. Euroclear, the company in question, together with other companies within the group, conducted securities transactions worth €452 trillion in 2006. But the company's name doesn't ring a bell. Stop a few passersby and ask them what Euroclear does. Unless you are standing next to that office center at lunchtime, not one of them is likely to answer.

Yet without Euroclear and its sister organizations, the world economy as we know it could not exist. The largest in Europe, Euroclear is one of many companies that offer infrastructure solutions for global financial markets.

...

After a brief description of the processes and participants in post-trade activities, we will talk about the Eurobond settlement crisis. And how Euroclear and its main competitor, Cedel, were created to overcome this crisis. The book will trace Euroclear's development, its emergence as an international provider of settlement services, and the expansion of its portfolio of securities, all in the context of the European settlement and clearing market. It will show how settlement became an important political issue after the 1987 stock market crash, and how, after the introduction of euro international settlements instantly came to the forefront of the European policy agenda. This is a story about companies and computers, organizations and ideas, markets and leaders.

We will not apologize for the fact that our work is empirical and for emphasizing the sometimes unpredictable role, both positive and negative, that individuals have played in shaping the European settlement and clearing industry. Many of the greatest figures of the financial world have worked in this lesser-known field. They have built the infrastructure on which Europe's economic growth and prosperity depend.

If we can isolate the main idea of the book, it is that financial markets and the supporting infrastructure services never develop according to a predetermined plan or project. Their development is the result of a complex interaction of global macro-financial forces, competition between companies, technological developments, domestic policies and laws of different countries, and - most importantly - the ideas and aspirations of people who work in financial markets.

Our book will attempt to trace these complex and not always orderly relationships through the example of the formation of the market for securities settlement services in the European Union over the past few decades.