John R. Shad

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John R. Shad

John R. Shad was a Wall Street banker, lawyer and former U.S. naval officer who served as chairman of the U.S. Securities and Exchange Commission in the 1980s. Shad was the first Wall Street banker to serve as SEC chairman in over 50 years at the time.[1]

Before joining the SEC, Shad had been vice chairman of the securities firm E.F. Hutton & Company Inc.

Schad died in 1994 at the age of 71.


Shad was born on June 27, 1923 in Brigham City, Utah and raised in California and served in the U.S. Navy during World War II.[2]

He started his career at Value Line, Inc. as a securities analyst in 1949 and then later at an early version fo Shearson.

He was recruited by E.F. Hutton to join the firm in 1963 and quickly rose as a deal-maker. He focused on second-tier, smaller companies that were unattractive to the bigger, older investment banking firms.

He rose to vice chairman at E.F. Hutton, but lost out on a bid to become chairman to west coast executives.

Shad was a life-long Republican, and was an early supporter of Ronald Reagan for the presidency in 1980. Shad headed Reagan's New York fundraising operation for the 1980 election. Reagan then appointed Schad to be the chairman of the SEC, where he promoted free-market ideas of the University of Chicago and fostered deregulation.[3]

He replaced Harold Williams as chairman of the SEC.[4]

After being then then longest serving chairman of the SEC, Shad was nominated by President Ronald Reagan to be Ambassador to the Netherlands.

Shad-Johnson Accord

During Shad's tenure as SEC chairman, a turf war between the SEC and the CFTC over regulation of new stock index future products produced an agreement with his CFTC counterpart called the "Shad-Johnson Accord."[5]

Phillip McBride Johnson was the chairman of the CFTC at the time when the CME, CBOT, KCBOT and NYFE wanted to launch stock index futures in the U.S. Futures were then regulated by the CFTC and had been mostly agricultural in nature.

However, in the 1970s, financial futures were introduced. And in the 1980s, leading futures exchanges applied to launch stock index futures. As a result of the accord, the CFTC was given jurisdiction over all futures, including futures on stock indexes, options on futures and commodities, and certain futures and options on futures on stock indexes. The SEC received jurisdiction over options on individual securities, options on certain indexes of securities, and exchange-traded options on foreign currency.

The accord also punted on the jurisdiction over single-stock futures, essentially outlawing them until the Commodity Futures Modernization Act of 2000 allowed them.[6]


Shad graduated with honors from the University of Southern California 1947, after a three year interruption for his service in the Navy during the war.

He earned a masters of business administration from Harvard Business School in 1949 and a law degree from the New York University Law School in 1959.


  1. John S. R. Shad Dies at 71; S.E.C. Chairman in the 80's. New York Times.
  2. Securities and Exchange Commission Chairman John Shad, who has. UPI.
  3. To Boost Investment, End S.E.C. Rule That Spurs Stock Buybacks. New York Times.
  4. John Shad, a vice chairman of the E.F. Hutton. UPI.
  5. No SEC-CFTC Merger — Shad-Johnson 2?.
  6. H.R.5660 - Commodity Futures Modernization Act of 2000.