Posts Tagged ‘OTC’
Wednesday, January 27th, 2010
Forex dealers are not taking the latest rogue regulatory action – CFTC‘s proposal to limit leverage in OTC forex - lying down. Last week, the Forex Dealers Coalition (FXDC), a group of the nine largest firms in the industry, sent a letter to the CFTC saying its proposal to limit leverage to 10-1 would “be a crippling blow to the industry and drive it offshore.” The CFTC kicked off its 60-day comment period last week, after which it will make its decision on the proposal. You can get more information and send a letter to the CFTC through FXDC’s Web site, www.fxdc.org. How will the proposal affect your trading? Leave your comments below.
Tags: CFTC, forex, OTC
Posted in Regulatory/actions | 3 Comments »
Friday, January 15th, 2010
The credit crisis and various financial scandals of recent years have changed the landscape for U.S. regulators. In was strong regulation and out was warm and fuzzy talk of public/private cooperation. In also was supposed to be interagency cooperation.
While one of the five key objectives of the Obama Administration’s audacious regulatory overhaul proposal was to Establish comprehensive supervision of financial markets and it set as a goal harmonizing regulatory regimes to prevent regulatory arbitrage and gaps in coverage, that hasn’t necessarily been followed through on.
Case in point is the Financial Industry Regulatory Authority’s (Finra) proposed Rule 2380. In its original form the rule would have limited the leverage broker/dealers could offer their customer in forex trading to 1.5-1. That is the customer would have to put up about $67,000 for a standard $100,000 forex position.
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Tags: bailout, CFTC, OTC
Posted in Regulatory/actions | 1 Comment »
Wednesday, January 6th, 2010
CFTC Chairman Gary Gensler kicked off the new year by outlining his goals for regulatory reform in a speech before the Council on Foreign Relations today. In it, Gensler blamed over the counter (OTC) derivatives for much of the financial crisis of 2008. “I believe that over the counter derivatives were at the heart of the crisis. We have all witnessed firsthand the effects that unregulated derivatives had across the entire economy,” he said. (more…)
Tags: Bill Brodsky, CBOE, Gary Gensler, OTC, regulation
Posted in Regulatory/actions | No Comments »
Wednesday, October 21st, 2009
Regulation talk was all the rage at the Futures Industry Association’s annual expo in Chicago today. In his keynote address, Commodity Futures Trading Commission (CFTC) Chairman Gary Gensler reiterated past talk about over the counter (OTC) derivatives clearing reform and CFTC-SEC harmonization. Exchange leaders also weighed in with thoughts about how some of the proposals coming down the pike could make the U.S. futures industry less competitive.
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Tags: Bill Brodsky, CFTC, Futures Industry Association, Gary Gensler, John Damgard, OTC, regulation, Terry Duffy
Posted in Regulatory/actions | No Comments »
Wednesday, August 12th, 2009
The Treasury department took the next steps in regulatory reform for over the counter (OTC) derivatives when it delivered legislative language to Capitol Hill yesterday. Treasury looks for Congress to create a bill on the matter by the end of the year, according to its press release. The legislation contains proposals from the Treasury’s regulatory blueprint from June, including requiring central clearing and trading of standardized OTC derivatives and moving more OTC derivatives on exchanges. (more…)
Tags: CFTC, ISDA, OTC, Treasury
Posted in Regulatory/actions | No Comments »
Tuesday, June 23rd, 2009
How did the financial world descend into full meltdown mode last year? Among other things, two factors seem to be at fault: ignoring of history and lack of education, according to John Miller, executive director of the International Center for Futures and Derivatives at the University of Illinois at Chicago. At the Managed Funds Association‘s annual forum in Chicago today, Miller offered an insider’s look at understanding the financial crisis.
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Tags: Managed Funds Association, OTC, regulation
Posted in General, Regulatory/actions | No Comments »
Monday, June 22nd, 2009
In testimony before the Senate Banking Committee today, Commodity Futures Trading Commission (CFTC) Chairman Gary Gensler laid out some objectives for the regulation of over the counter derivatives, including modification of the Commodity Exchange Act (CEA). OTC derivatives are still a hot topic in the industry, especially after President Obama’s regulatory reform proposal last week called for both the Securities and Exchange Commission (SEC) and CFTC to have a hand in regulating them. (more…)
Tags: CFTC, Gary Gensler, OTC, regulation, SEC
Posted in Regulatory/actions | 1 Comment »
Thursday, June 18th, 2009
Industry leaders wasted no time commenting on the Obama Administration’s new regulatory reform proposal, “Financial Regulatory Reform: A New Foundation,” released yesterday.
The proposal received mostly a chorus of praise from the industry. CME Group called it “a significant step towards restoring confidence in the integrity of financial markets.” International Swaps and Derivatives Association CEO Robert Pickel said in a statement that it “provide[s] an important framework for financial regulatory reform.” In his statement, Futures Industry AssociationPresident John Damgard “commend[ed] the administration for the thoughtfulness and comprehensiveness of its plan.” In a statement, Chicago Board Options Exchange ChairmanBill Brodsky said, “We are particularly pleased that the plan recognizes the need for greater coordination and harmonization of the SEC and CFTC, including streamlining the approval of new products and rule filings.” But not everyone is singing the proposal’s praises. (more…)
Tags: Barack Obama, Bill Brodsky, CBOE, CFTC, CME Group, credit default swaps, John Damgard, OTC, Robert Pickel, SEC, Treasury Department
Posted in Regulatory/actions | 1 Comment »
Friday, May 15th, 2009
This week has been a busy one for new regulation affecting the futures and options industry. It started off on Monday with the Treasury’s 2010 revenue proposal that included a proposal to eliminate 60/40 tax treatment for futures and options traders. Then on Wednesday, the Treasury Department released a proposal on regulatory reform for over the counter (OTC) derivatives. That one was less of a bombshell.
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Tags: 60/40 tax treatment, CFTC, Commodity Exchange Act, ISDA, OTC, SEC, Treasury
Posted in Regulatory/actions | 1 Comment »
Friday, October 26th, 2007
It seems that significant changes to the Commodity Futures Trading Commission (CFTC) are just around the corner, if and when reauthorization of the regulatory body comes up for a vote someday.
On Wednesday, the CFTC’s Acting Chairman Walter Lukken testified before the Subcommittee on General Farm Commodities and Risk, (the title of which alone is testimony for the need to change), and proposed that the Commodity Exchange Act be amended such that the CFTC has four new authorities:
1. Require large trader position reporting
2. Require exempt commercial markets (ECM) to adopt position limits or accountability levels.
3. Require ECMs to exercise self-regulatory responsibility over that contract to avoid manipulation; and
4. Provide the ECM and the CFTC with emergency authority over that contract.
In press statements, the Nymex and the Intercontinental Exchange both came out in support of changes to the current regime, and as they are potentially the most affected by the changes, that is all well and good. The question is now and will be, should this apply to all ECMs all the time? Lukken addressed that issue by adding that “price discovery is the key determinant to Commission regulation and oversight.” But is this the targeted approach that the ICE and Nymex intend to support? Maybe, maybe not.
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Tags: CFTC reauthorization, congressional testimony, forex, OTC
Posted in Regulatory/actions | No Comments »
