8.5 Other Disclosures to the Market

Governmental entities make many public statements and make large amounts of information available to the public. This information may be used by many types of constituents, such as investors, credit rating agencies, voters, taxpayers, and others. While investors appreciate that a broad context of information may improve market transparency, public agencies must exercise care in making statements or providing information intended or likely to reach the securities market. The two principal concerns are as follows:

Making public statements that mislead market participants (especially statements that are overly optimistic or present only the positive side of a two sided issue)
Making material information available to some market participants that can use it to gain an unfair advantage over other market participants (a problem referred to in securities law as “selective disclosure”)

Strategies for addressing these concerns are generally focused on vetting information for misstatements or material omissions before it is made public and making complete and accurate information on topics of interest available to the entire market.