Thursday, September 24, 2009

Some thoughts on liquidity

Liquidity is a critical factor in our economy. It allows people flexibility to move in and out of investments without penalty. It keeps people from having to buy or sell in a panic. Liquidity builds confidence in the financial markets, allowing more financial risktaking, thus generating more innovation.

The IPO market is broken. Sarbanes Oxley and other regulations and accounting complexities have made it untenable for growth companies to go public. It is also uneconomic for investment bankers to take anything public with a market cap under $1 billion.

Xchange is changing the game. Xchange allows companies liquidity and allows them to stay private and unencumbered by burdensome regulations.

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