SEC Chair Jay Clayton promoted the consideration of disclosure and other "rules of the road that foster both liquidity and a long term perspective."
In a speech at an SEC roundtable event, Mr. Clayton stated that long-term perspective and "timely and quality" disclosures create market liquidity. In order to achieve these, Mr. Clayton emphasized two points:
- looking at the "macro forces" that influence the short-term behavior in the markets and to consider possible initiatives that address the behaviors; and
- understanding the disclosure framework and related regulations as a whole, rather than as "individual items."
Mr. Clayton advised that macro-economic performance is not necessarily indicative of an "excessive short term problem." Instead, he recommended that policy makers should not only consider the possibility that companies plan too much for the short term, but should also consider whether the issue is specific to public markets and how that impacts the allocation of capital.
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