Money Stuff: The Podcast T+Lunchtime: Settlement, Musk, Hwang
May 31, 2024
The hosts dive into the exciting shift to T+1 stock settlement, likening it to a rare celestial event and tackling its efficiencies and conspiracies. They explore the controversy over Elon Musk's stock options and the implications of his leadership on Tesla amidst market changes. Discussion also pivots to Bill Hwang's trial, shedding light on the Archegos scandal and the ethical dilemmas in finance. Plus, they address trading system designs that could mislead users into poor decisions.
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Episode notes
T+1 Success
- T+1 settlement has arrived, and it seems to be going smoothly, even better than T+2.
- The fail rate is lower, perhaps due to system modernization or heightened attention.
Instantaneous Settlement Impact
- Moving to instantaneous settlement like crypto would change the financial system.
- Pre-funding trades would be necessary, unlike the current system.
Securities Lending Headache
- Securities lending is impacted by T+1, with less time to recall borrowed securities.
- Mutual funds and ETFs may recall borrows earlier, potentially revealing selling intentions.