    [Weekly Compilation of Presidential Documents Volume 35, Number 17 (Monday, May 3, 1999)]
    [Page 763]
    [Online from the Government Publishing Office, www.gpo.gov]

    <R04>
    Statement on the Report of the Working Group on Financial Markets

    April 29, 1999

        As part of our ongoing efforts to increase opportunities and reduce
    risks in the global economy, we have focused on ways to strengthen the
    world's financial system. Today I welcome the Working Group on Financial
    Markets' report entitled ``Hedge Funds, Leverage, and the Lessons of
    Long-Term Capital Management.''
        The report contains a number of policy recommendations that are
    designed to reduce the potential risks of excessive leverage, as
    demonstrated by the near-collapse of long-term capital management. By
    enhancing transparency in the financial system, by increasing the amount
    of information made available to the public, and by improving risk
    management on the part of financial institutions, we can help reduce
    these risks. Taken together, the report's recommendations are an
    important step in our efforts to promote more secure financial markets.
    This report is the result of a collective effort by all of the Federal
    financial regulatory agencies. I want to commend the Working Group for
    this thoughtful report. I look forward to working with Congress on these
    important issues.