The Beginners Guide To Regulations (Chapter 1)

Aug 1, 2017 by

Details on Financial and Securities Regulation

The government functional bodies include the financial and securities agencies of regulation, and they supervise the financial companies and markets. These agencies are mandated to take up different roles and responsibilities. They do not depend on anyone when they are working even though their objectives are identical. There is criticism on the efficiency of the agencies, but their existence is indefinite. The following text contains several functions of the agencies.

Stirring the Economy
Some financial and security agencies work to stimulate the economy through influencing overall credit conditions, money and liquidity. These agencies apply tools that control the sale and purchase of treasury securities and agency securities. The agencies foster the stability of the banking system through regulating that interest rates and supervising the banking system.

Insuring Deposits
There are agencies that provide protection on bank deposits that individuals and entities make in any bank. The insurance prevents a depositor from losing money when an eventuality takes place. There is a limitation on a number of individual’s or entity’s deposits that the insurance covers.
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Controlling Currency
It is necessary to ensure that there is competition between banks. It means that provision of charters to banks should be overseen by a regulatory body. Such an agency has the main objective that entails the maintenance of a solid banking system; a process that includes supervision, regulation and provision of bank charters. The agencies also facilitate efficient banking as well as financial services.
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Oversight on Securities that are For Sale to the Public
Some agencies foster efficiency when members of public want to trade in securities. These agencies act as middlemen between the customers and brokers. Training, licensing and testing financial professionals are the main duties of the agencies. In addition, they act as mediators and arbitrators when customers and brokers have disagreements.

Regulating Insurance
The operations of the insurance industry are monitored, reviewed and overseen by the agencies. There is monitoring, reviewing and overseeing the operations of the insurance industry by the agencies. Consumer protection, investigations on criminal activities, and law enforcement are some of the activities that the agencies carry out in their main objective of sanitizing the insurance industry. Notably, these agencies act on behalf of the state.

Impose Securities Law
The agencies do not depend on governments when enforcing the law. They are some of the most powerful and comprehensive agencies. They have oversight over stocks and options exchanges, options markets, and electronic exchanges and securities.

There is a non-direct link between people and the agencies, but people still feel the impact of the agencies’ regulations. Some of the areas that make the impact to be felt most include liquidity, credit markets and interest rates application. It shows that the effects of the agencies indirectly affect a common person.

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