Mourning the Death of Peace

Alyssa A. Lappen | February 23, 2001

I am a Jew. I am a poet. I am heartbroken. Next to God and Jerusalem, the thing most central to Judaism is peace. But my people’s fervent prayers for peace – embodied for millennia in every Jewish prayer – every one – again go begging, when they seemed at last so close to fruition. We find our homeland unwittingly immersed in another war, the sixth in Israel’s short life.

The United Nations years ago equated Zionism with the basest human emotion. Yet my most beloved friend, also a poet, was an Arab. Chris Khattar gave me priceless encouragement to renew the poetic voice I had lost for 15 years. Before he died of Hodgkin’s in 1992, I gave him a poem. I am also fortunate to count among my neighbors, colleagues, fellow-poets, like-minded parents and friends, other Muslims and Arabs, Christians, African Americans, East Indians, Native Americans, Hispanics, Chinese, Japanese, and people who are disabled, sightless, gay – anyone, in short, open to mutual respect and willing to bless me with kindness, intelligence, wisdom. By this Jewish precept – respect – I strive to conduct all my affairs.

Last spring I felt great pride in learning that my first chapbook, The People Bear Witness, would soon appear in a journal published by Catholic theologians along with work by a Palestinian poet. Honored to be in his company, I wrote him an email, kindly forwarded by our editor. I was heartened by his praise for my work, but disappointed by his failure to return my salutations – in Hebrew and Arabic – of peace. I had high hopes for the Camp David II talks then in progress; he signed note only, “Cheers.”

Months later as violence erupted, I extended a hand again – a small gesture I nevertheless felt necessary: Jewish theology requires small acts of goodness. These in turn can save lives – and each life is considered as an entire world. His reply pained me: On the one hand, he accepted my sincerity. On the other, he questioned it: “The Jews demand, rightly, apologies and compensation from those who wronged them. These are not part of Israel’s negotiating discourse. That is why, to tell you the truth, I find your signature at the end (Shalom, Salaam) too casual.” For every gain his people might make, he said, “we will pay a terrible price.” I wrote our editor, “When even poets cannot talk, we have a problem in Jerusalem.” I had no idea yet how big.

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Behavioral Finance: Old Wine in a New Bottle

by Alyssa A. Lappen and Heidi L. Schneider
The Journal of Wealth Management | Fall 2000 | Vol. 3, No. 2

https://jwm.pm-research.com/content/3/2

https://jwm.pm-research.com/content/3/2/9

Old Wine in a New Bottle_fall.2000

Noting that, in recent years, dozens of academic articles have been written on the subject of behavioral finance, the authors first propose a brief review of the literature and argue that its main message is that behavioral factors affect virtually every aspect of finance—from prices of individual stocks to absolute returns and from individual retirement planning to investor confidence. Yet, they identify a void with respect to discussions as to how active portfolio managers have long applied behavioral finance to the investment process. They go on to explain some market anomalies created as a result of human error and detail a few ways in which portfolio managers can use behavioral observations to manage client’ funds.

Securities Trading Via the Internet

By Paul D. Cohen *
Stanford Journal of Law, Business & Finance | Winter 1999

* Duke University, B.A., 1992; Washington University School of Law, J.D., 1996; Washington University John M. Olin School of Business, M.B.A., 1997. I would like to express my appreciation to Professor John C. Coffee, Jr., Adolf A. Berle Professor of Law, Columbia University School of Law, for his insights and suggestions; to Ms. Ann D. Wallace, Special Associate Director, Division of Corporation Finance, U.S. Securities and Exchange Commission, for her advice and inspiration; to Kevin Coenen, Kirkland & Ellis; and to Scott J. Golde, Greensfelder, Hempker & Gale, for their comments.

HIGHLIGHT:
“Technology-related issues are the most important, pervasive, promising and pressing issues facing the [Securities and Exchange] Commission and the markets.”

— Steven M. H. Wallman, Securities and Exchange Commissioner 1

With the growing popularity and use of the Internet, several companies have launched their own Internet-based trading systems. These systems fall into one of two main categories: Internet-based bulletin boards and Internet-based crossing systems. Internet-based bulletin boards bring buyers and sellers of securities together by providing a place, usually the issuing company’s home page, where an individual posts an interest to purchase or sell securities. Interested parties then privately negotiate a trade. Internet-based crossing systems play a more active role in facilitating a trade. They collect trading interests from investors and, through a computerized algorithm, match buyers and sellers of securities.

Securities regulations currently categorize trading establishments as either broker-dealers or exchanges for regulatory purposes. While Internet-based bulletin boards and Internet-based crossing systems perform many of the functions of a broker-dealer and a national securities exchange, they do not fall directly within the definition of either. Due to the unique character of internet trading, regulation of Internet-based trading systems through traditional regulatory categories may hinder their integration into the National Market System, may inadequately protect investors from fraudulent and manipulative practices, and may impede other goals of the U.S. securities laws.

New technology requires a new regulatory approach. Possible alternatives include a new system-specific regulatory category, a modified broker-dealer approach, or a tiered exchange approach based on trading volume. This paper assesses the strengths and weaknesses of each proposal.

Citation:
n10 David P. Brown, Why Do We Need Stockbrokers? 52 FIN. ANALYSTS J. 21 (1996). The Designated Order Turnaround (DOT), technologically updated with the SuperDOT system, permits exchange members to forward orders of up to 100,000 shares to the trading floor electronically. Nyquist, supra note 2, at 298, 318. Other markets also offer automatic routing systems. Id. at n. 86. Money managers often use electronic networks such as SuperDOT, which charge 2.5 cents per share, because of the price advantages they offer. By using these systems, money managers also reduce or avoid market impact. Use of SuperDOT accounts for 80% of the orders placed on the NYSE and more than half of the NYSE’s annual share volume that measures 74.4 billion shares. Alyssa A. Lappen, “The Cost of Inefficiency,” Money Management, [Institutional Investor] Mar. 1995, at 65. For further discussion of these systems, see LOUIS LOSS & JOEL SELIGMAN, 5 SECURITIES REGULATION 2556, 2557-58 (1990).

Jacobs’ lather

By Alyssa A. Lappen
Institutional Investor | August 1999

With the U.S. stock market continuing to punch through record levels, pundits occasionally trot out the usual suspects that might end the financial exuberance: resurgent inflation, trouble in the Balkans, 100 new Internet IPOs.

One money manager, however, is warning about a very different and more complicated scenario that could trip up the markets. It takes a little options theory to make sense of the logic. You’re not likely to hear about it at cocktail parties. But Bruce Jacobs may have history on his side.

In his new book, Capital Ideas and Market Realities: Option Replication, Investor Behavior, and Stock Market Crashes, Jacobs, co-founder and principal of Roseland, New Jersey-based Jacobs Levy Equity Management, argues that recent market breaks have been caused by new forms of derivatives-related forced trading. As investors seek to protect or adjust their portfolios with options strategies, he asserts, they ironically create an environment where a moderate decline in the market could turn into a brutal fall or even a crash.

â€œThat’s precisely what happened in 1987,â€ says Jacobs. â€œOctober 19 saw trading equivalent to many days’ volume, and people reacted as if there were negative fundamental information when there was none.â€ In 1987 a then-popular form of hedging called portfolio insurance was blamed by some regulators and investors for at least exacerbating if not causing the market crash. Continue reading “Jacobs’ lather” →

Heavy Load

Money management

Are traditional load mutual funds heading for extinction?

by Alyssa A. Lappen
Institutional Investor | Aug. 1, 1999

Vol. 33, No. 8, p. 166
656 words

Tactical Maneuvers

Cover Story

In choppy financial markets the country’s large asset allocators have come back into style

by Alyssa A. Lappen
Institutional Investor | Jul. 1, 1999

Vol. 33, No. 7, p. 167
1,642 words