In the course of encouraging competition in telecommunications markets, regulators in both Australia and the UK are developing proposals to impose accounting separation upon dominant incumbents. This paper examines the logic behind accounting separation as an alternative to structural...

"The expected time- and risk-adjusted cumulative return on any asset equals one at all horizons. Nonetheless, I show that a typical asset's realized time- and risk-adjusted cumulative return tends to zero almost surely. As a corollary, the value of a typical long-dated asset is driven by extreme...