Welcome to DU! The truly grassroots left-of-center political community where regular people, not algorithms, drive the discussions and set the standards. Join the community: Create a free account Support DU (and get rid of ads!): Become a Star Member All Forums Issue Forums Culture Forums Alliance Forums Region Forums Support Forums Help & Search
 

Demeter

(85,373 posts)
22. Gensler Staring Down Administration and Banks on Derivatives Reform NAKED CAPITALISM
Thu Jun 27, 2013, 07:52 AM
Jun 2013
http://www.nakedcapitalism.com/2013/06/gensler-staring-down-administration-and-banks-on-derivatives-reform.html

Yves here. Readers may recall that Gary Gensler, the head of the Commodities Futures Trading Commission, is being pushed out by Obama. His planned replacement is so appallingly lightweight (oh, and formerly in a very junior role at Goldman) as to assure that all she’ll be able to do is take dictation from financial firm lobbyists.

But Gensler may be having a last laugh before he leaves office. The proximate reason for his ouster was that he was refusing to accede to the demands of banks and foreign regulators over implementation of Dodd Frank rules on swaps. As we wrote earlier this month:

Shahien Nasiripour at the Huffington Post describes how Gensler is being ousted for his position on swaps regulation, which was coming to a head in international meetings starting June 20, with a July 12 deadline looming. The industry was pushing for the usual “race to the bottom” approach, since the Dodd Frank provisions are more stringent than overseas requirments (the spin, of course, was that Gensler was acting unilaterally, as opposed to implementing what Congress mandated). Gensler faces varying degrees of resistance from three of his four fellow commissioners. International regulators were apparently also unhappy with Gensler’s tough stand, to the point where they were complaining to Treasury Secretary Jack Lew.


And bear in mind that the reason the banks are howling like stuck pigs is that the businesses in question are are significant profit sources. The International Financial Review gives an idea of the implications if Gensler hangs tough:

Figures from the US Treasury show that US financial institutions reported derivatives trading revenues of US$4.4bn in the fourth quarter of 2012, a 73% increase on the previous year.

These revenues were dominated by JP Morgan, Bank of America Merrill Lynch, Citigroup and Goldman Sachs. And analysts estimate that US banks route around 50% of their derivatives trades overseas, which would mean a sea change for their operations, not to mention their bottom lines, if the exemption was allowed to die.

“US banks simply aren’t ready to lose this exemption. It will cost them a considerable amount,” the first lawyer said. “Even just the logistical challenge of reorganising their trading business will be enormous, and they are likely to lose clients because of it.”


George Bailey, via e-mail, describes how Gensler is in a position to prevail in this important but largely unnoticed regulatory battle....SEE LINK FOR THE REST
SOURCE ARTICLE: 76% of Americans Are Living Paycheck-to-Paycheck Demeter Jun 2013 #1
It takes one Demeter Jun 2013 #2
For those who care Demeter Jun 2013 #3
Next week is July 4th holiday, gas likely will go up DemReadingDU Jun 2013 #4
Good point. Demeter Jun 2013 #5
Good reminder. Fuddnik Jun 2013 #34
Scalia Arrested Trying to Burn Down Supreme Court (SATIRE) Posted by Andy Borowitz Demeter Jun 2013 #19
Europe strikes deal to push cost of bank failure on investors xchrom Jun 2013 #6
Bank Runs! DemReadingDU Jun 2013 #20
They certainly have that power Demeter Jun 2013 #25
More from ZeroHedge DemReadingDU Jun 2013 #24
In Other Words, Special Deals for my friends and supporters Demeter Jun 2013 #27
Some Unemployed Keep Losing Ground (BIG SHOCK TO READERS OF WSJ) Demeter Jun 2013 #7
U.S. economy looks weaker, as GDP data is revised RECOVERY? WHAT RECOVERY? Demeter Jun 2013 #31
Britain's double dip recession revised away, but picture still grim xchrom Jun 2013 #8
On Bullying Friends Demeter Jun 2013 #9
Ireland slips back into recession xchrom Jun 2013 #10
Bridgewater funds take a battering Demeter Jun 2013 #11
California sends a cease and desist order to the Bitcoin Foundation Demeter Jun 2013 #12
Snowden distributed encrypted copies of NSA docs around the world Demeter Jun 2013 #13
Young may dodge health law: For 20-somethings, penalty maybe preferable to buying insurance Demeter Jun 2013 #14
The Public Option “Alternatives” Are Proving to be Mostly Worthless Demeter Jun 2013 #16
Employers Test Plans That Cap Health Costs By REED ABELSON Demeter Jun 2013 #18
Cue Tansy_Gold Jun 2013 #35
Gold Is Falling Again xchrom Jun 2013 #15
The Rise Of Shadow Banking In China [CHART] xchrom Jun 2013 #17
HSBC, Citigroup Win Approval to Sell Mutual Funds in China Demeter Jun 2013 #30
The Vanishing I.R.S. Scandal by John Cassidy Demeter Jun 2013 #21
Gensler Staring Down Administration and Banks on Derivatives Reform NAKED CAPITALISM Demeter Jun 2013 #22
U.S. Needs More Time on Overseas Swaps, Democratic Senators Say Demeter Jun 2013 #29
TTFN! Demeter Jun 2013 #23
see ya, miss demeter! xchrom Jun 2013 #28
Congrats, CEOs! You’re making 273 times the pay of the average worker. xchrom Jun 2013 #26
Clean Energy to Run Past Nuclear, Gas by 2016 Demeter Jun 2013 #32
ETA News Release: Unemployment Insurance Weekly Claims Report (06/27/2013) mahatmakanejeeves Jun 2013 #33
Song for Today's (this week's) DOW and Oil prices Demeter Jun 2013 #36
Corzine Officially Charged By CFTC For Filing False Reports, Commingling Funds DemReadingDU Jun 2013 #37
It's been pouring for 45 minutes Demeter Jun 2013 #38
Latest Discussions»Issue Forums»Economy»STOCK MARKET WATCH -- Thu...»Reply #22