Timeliness of the data would also be an issue. A public database of nonproprietary information could provide the public with a general picture of hedge-fund activity without creating the false impression that the authorities were engaged in prudential oversight of hedge funds. Such a public database might demystify hedge funds, but it would not address the central policy concern that opacity creates liquidity risk.
I expect discussion and analysis of the potential costs and benefits of increased disclosures will continue, as well as suggestions about how such disclosures might be structured and disseminated. The important challenge is to structure any disclosures in a way that does not generate moral hazard or weaken market discipline. Conclusion In the final analysis, authorities cannot entirely eliminate systemic risk.