Transatlantic exchange race hits homestretch

Steve Tripoli Dec 20, 2006
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Transatlantic exchange race hits homestretch

Steve Tripoli Dec 20, 2006
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SCOTT JAGOW: Both the NASDAQ and the New York Stock Exchange are trying to buy financial markets in Europe. One’s having success, the other isn’t. The London Stock Exchange just told its shareholders to reject the NASDAQ’s bid. London says the offer is way too low. But the shareholders of Euronext overwhelmingly approved a merger with the New York Stock Exchange. The NYSE votes on the deal today. More now from Steve Tripoli.


STEVE TRIPOLI: Expect a resounding yes vote from New York Stock Exchange shareholders today. New York needs a European beachhead in the competitive world of stock markets.

Europeans once worried that this marriage would mean strong American regulation that would hurt their companies.

Kurt Schacht is with the Centre for Financial Market Integrity. He says neither U.S. nor European rules are likely to prevail at first.

KURT SCHACHT: It will be like sort of any other global corporation that has operating businesses in different countries that have to operate under different legal and regulatory structures.

James Cox at Duke University says global stock market mergers will eventually lead to a blend of regulatory styles. And he worries that will lead to less protection for all investors.

JAMES COX: Because there’s gonna be regulatory competition, and that’s gonna be competition that’s gonna move things to the lowest common denominator, not the highest standard.

In theory at least, these mergers should help investors. They’re supposed to lower transaction costs and make it easier to diversify into foreign stocks.

I’m Steve Tripoli for Marketplace.

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