Winter 2009

Winter 2009

Cover Story

  • Riding It Out

    Amid layoffs, eliminated bonuses, and hiring freezes, Wharton alumni and students evaluate prospects for careers in finance in a global downturn.

Featured Stories

  • An Empire City of Dreams

    Dubai has built a service economy for the Middle East, and Wharton is there.

  • Water Shock

    Water shortages could be the next political and economic flashpoints — and Wharton alumni and faculty are working towards solutions.

  • State of Business 2009

    Professors Franklin Allen, Mike Useem, Jeremy Siegel, and Stephen Hoch on the state of the economy now and in the year to come.

Articles

  • Wharton Makes News

    A sampling of recent news stories that include Wharton alumni and faculty.

  • In Brief

    Wharton News and Updates

  • New Environmental Dual Degree

    Wharton has added another dual-degree option, pairing its MBA with a Master of Environmental Studies degree offered by Penn’s School of Arts and Sciences (SAS).

  • Leadership Spotlight: Mohammed Alshaya, WG’84

    A chance meeting brought Mohammed Alshaya to Wharton. Subsequent Wharton chance meetings have contributed to his
    family’s business, one of the oldest and most prominent in Kuwait.

  • Leading When the Need Is Greatest

    One new title explores how to channel the economic potential of Africa, while a revised classic from Jon M. Huntsman describes how to lead with integrity during tough times.

  • Do the SEC’s New Rating Agency Rules Have Any Bite?

    On December 3 the Securities and Exchange Commission approved tighter regulations on the credit rating agencies, hoping curbs on conflicts of interest will prevent the kind of ratings-grade inflation that played such a key role in the credit crisis. The SEC voted to require greater disclosure and to ban agencies from rating securities they have helped issuers create. While the ratings firms applauded the moves, reform advocates were disappointed. The changes fell far short of remedies initially proposed by the SEC in June and supported in a December 1 statement by the Financial Economists Roundtable, a 15-year-old group of top economists from around the world that meets every year to tackle economic issues. By omitting two critical elements of the June proposal, the SEC pulled the teeth that would have made the regulations effective, according to the FER. “It’s a quarter of a loaf at best. The one thing they did was the one thing that we thought was unenforceable,” says Wharton finance professor Richard J. Herring, the roundtable’s executive director, referring to a ban that would prevent agencies from rating securities for which they have provided paid advice to the issuer. The FER’s December 1 statement urged stronger public disclosure of data used in the agencies’ computer models, less use of ratings in governmental regulations, and a requirement that ratings on riskier types of securities state a margin for error. Indeed, most of these ideas had been tentatively proposed by the SEC staff in June, but were dropped, diluted, or delayed in December. FER members met July 12-14 in Glen Cove, NY, and refined their statement through the summer and fall. Wharton finance professor Marshall E. Blume, one of several Wharton faculty members of the roundtable, describes the SEC’s June proposal as “very bold,” but says the “the final […]

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