While the U.S. regulators demand a massive amount of transparency in stocks, corporate bonds, and munis, the $13t Treasury market still remains a bit of a Wild West. Universal information reporting standards are being championed by both market participants and the government as a means to combat illiquidity and price volatility.
Researchers at the New York Fed pointed out that bouts of illiquidity have increased, making it more challenging for investors trading government securities during times of stress. By one measure, outsize price swings are occurring almost twice as often as statisticians would normally expect, according to data compiled by TD Securities. Antonio Weiss, a counselor to Treasury Secretary Jacob J. Lew, is leading the government’s push to assess what data are needed.