One of the most effective steps we've taken is to shorten the settlement cycle for securities transactions from five business days to three. We are pleased to see other countries moving towards shorter settlement cycles. I believe that shorter cycles will benefit all of us. And, because many investors now look to markets around the world for investment opportunities, it may be wise for us to consider establishing uniform, global settlement cycles to increase liquidity and enhance the movement of funds across markets. This system ensures that payments made today are good today.
Disclosure is also important to understanding and controlling risk in the settlement process.
Earlier this year, the International Organization of Securities Commissions and the Committee on Payment and Settlement Systems of the Central Banks of the G-10 Countries developed a framework for making important disclosures about securities settlement systems. This framework will help market participants evaluate the risks of participating in securities settlement systems. The Commission has asked major U.S. clearing organizations for their response to the disclosure framework, and I urge you to encourage clearing organizations in your own jurisdictions to complete the disclosure framework as well. In the U.S., there is still widespread use of physical certificates, which are at best an inefficient transfer mechanism. We've been taking steps to reduce dependence on physical certificates.