Examining a sample of 701 offshore securities offerings under Regulation S of the Securities Act from 1993 to 1997, the article tests whether foreign investors expect to resell Regulation S securities into the United States ahead of the U.S. secondary market reaction to news of the offering. The article provides evidence from an event study that the secondary market reaction to a Regulation S offering is negative and statistically significant. Foreign investors able to resell into the United States ahead of the secondary market reaction, therefore, may act as conduits for issuers attempting to sell overvalued securities into the United States to the detriment of U.S. investors. To the extent managers seek to benefit pre-offering shareholders, they will negotiate to give foreign investors as small an offering discount as possible. In contrast, where foreign investors are unable to resell prior to the secondary market negative reaction to news of the offering, foreign investors will demand a greater discount in compensation for the entire expected market reaction. Without such a discount, Regulation S offerings result in a transfer in value from foreign investors to U.S. investors; rational foreign investors will choose not to participate in such offerings. Controlling for other factors that may affect the offering discount, the article furnishes evidence on the offering discount consistent with the hypothesis that foreign investors were in fact unable to engage in resales ahead of the U.S. secondary market reaction to a Regulation S offering.

Mexican immigrants and persons of Mexican descent constitute an important and rapidly growing segment of California’s labor force (18 percent in 1990, up from 13 percent in 1980). They are also among the most economically disadvantaged workers in California: in 1989, Mexican-origin households earned on average 33 percent less than non-Hispanic white households, 30 percent less than Asian households, and 6 percent less than black households.

Disagreement persists over the prospects for Mexican Americans joining the economic mainstream of American society. Chavez (1991) claims that the large inflows of recent immigrants from Mexico create a deceptively pessimistic picture of Mexican-origin workers in the U.S. labor market, and that U.S.-born, English-speaking Mexican Americans have enjoyed rapid progress over the last couple of decades and are approaching the labor market status of non-Hispanic whites. According to Chavez, Mexican Americans are making steady progress towards economic parity with Anglos, and he worries about the emergence of a Chicano underclass with many of the same problems faced by inner-city blacks.

Using national Current Population Survey data from November 1979 and 1989 and Census data from 1990 for California and Texas, I shed light on the this debate by analyzing in detail the wage structure and relative earning power of U.S.-born Mexican-American men.

The present securities regulatory regime in the United States focuses on the protection investors. Investor protection, in turn, leads to a robust capital market. The federal government accomplishes its goal of investor protection through the registration and direct regulatory control of issuers, intermediaries, and self-regulatory organizations in the securities markets. The Article contends that this regulatory approach is ill advised. Rather, the Article argues that regulators should instead regulate investors. Al-though against current wisdom, a securities regime that regulated investors would allow regulators to take a more market-driven approach toward in-vestor protection, resulting in a less paternalistic regime. For those inves-tors with good information on issuers in the market, for example, no mandatory regulations are necessary. Rather investors will contract for desired protections; those market participants failing to provide valued protections will receive less for their securities or services. As a result, market participants will voluntarily provide desired protections. The pa-per, therefore, proposes to classify investors based on their informational resources. Such classification frees those investors able to protect them-selves to engage in a wide variety of investments while allowing regulators to focus their resources on investors less well equipped.