If the US Bond Market is the Eighth Wonder of the World, the Depositary Trust & Clearing Corporation (DTCC) is certainly the Ninth.
Most people have never heard of DTCC but in 2012 it and two of its subsidiaries were named Systemically Important Financial Market Utilities (SIFMU’s”). SIFMUs are TOO BIG TO FAIL and must be regulated. In this case DTCC is supervised by SEC and Financial Stability Oversight Board.
If you are an investor, you interact with DTCC every day. Say you want to buy 100 shares of Microsoft through your brokerage firm, JP Morgan. Trading rules require your purchase to settle within 2 or 3 days of the trade. Your trade is processed and settled by DTCC and it keeps a ledger of your ownership.… Read this article