SEC Chairman Levitt Discusses Changes in the Securities Markets

Washington, DC, September 30, 1999 - In a recent address, "Dynamic Markets, Timeless Principles," SEC Chairman Arthur Levitt discussed significant changes occurring in today’s securities markets. He emphasized that "no matter how much our markets change, markets of fairness, markets of integrity, and markets of quality should not be the most investors hope for—but the very least they should expect." After a brief overview of how the markets have changed over the past 25 years, Chairman Levitt focused on the proposed demutualization of the national exchanges; the impact greater competition is having on order flow, liquidity, and execution costs; the imperative to interlink market centers; and more broadly, the challenge to provide investors with the efficiency of central markets without sacrificing innovation or stifling competition. With respect to centrality, he outlined these guiding principles: price discovery and best execution should be enhanced; liquidity should be fostered; interaction between institutional and retail trading should be maintained; market innovation should be encouraged; and competition among market centers, above all else, should remain vigorous and dynamic.