White House Details Plan on Derivatives

"
The Obama administration detailed a sweeping plan to more closely oversee the giant market for derivatives by forcing many of the products to trade on regulated exchanges.

The proposal, which was sent to legislators on Capitol Hill for consideration, seeks to prevent a repeat of problems last year, when the growing use of derivatives by many financial firms went unchecked. The proposal would essentially make it easier to see prices and make markets more transparent.
"

Should have done that many many years ago! Already very late, but never too late!

Anyway, very good news indeed!
 
The financial products marketed based on sub prime mort, does anyone know are these still being packaged and sold? Probably every derivative which led to the meltdown are not being done and if they are they are done more prudently.

The gov't is going to regulate something that happened in the past, the future will be something outside the regs. Isn't that how Wall Street works?
 
Quote from nutmeg:

The financial products marketed based on sub prime mort, does anyone know are these still being packaged and sold? Probably every derivative which led to the meltdown are not being done and if they are they are done more prudently.

The gov't is going to regulate something that happened in the past, the future will be something outside the regs. Isn't that how Wall Street works?
More...
No, people forget the past and as soon as the market goes up the circus can come back.
As for the CDOs, the number of issues went from hundreds of billion (2004) to about nothing (2008) but I dont know what is going on right now.
I was a real gimick.
 
'Those that are "standard" will have to go through a clearinghouse. '

1) A big reason OTC markets exist is because of custom needs

2) It is very easy to become non-standard
 
As an after thought, imo this is where the regulation is needed "shadow banking". As you can see, BSC and LEH already are/were regulated yet they failed.


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Shadow banking institutions are typically intermediaries between investors and borrowers. For example, an institutional investor like a pension fund may be willing to lend money, while a corporation may be searching for funds to borrow. The shadow banking institution will channel funds from the investor(s) to the corporation, profiting either from fees or from the difference in interest rates between what it pays the investor(s) and what it receives from the borrower.

By definition, shadow institutions do not accept deposits like a depository bank and therefore are not subject to the same regulations. Familiar examples of shadow institutions included Bear Stearns and Lehman Brothers. Other complex legal entities comprising the system include hedge funds, SIVs, conduits, money funds, monolines, investment banks, and other non-bank financial institutions.

http://en.wikipedia.org/wiki/Shadow_banking_system
 
Quote from codetroll:

WASHINGTON -- The Obama administration detailed a sweeping plan to more closely oversee the giant market for derivatives by forcing many of the products to trade on regulated exchanges.............

http://online.wsj.com/article/SB125002965377623915.html

Might mean more monies/opportunity to make more money. :)

-troll
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Ha ha ha! That's hilarious that the government wonks still think they can control everybody from a central point with no externalities.

Oh, the hubris of government and the innocents who believe in its power will never cease to amuse me.
 
Oh, BTW......they're relying on the SEC to "control" all of this.

The SEC walked into a private trading firm last week and asked them to explain to them how levered ETFs work! The SEC guys had no idea what they were!

Although, it's equally disturbing that the SEC feels that it can just arrive at your firm and suck your time during the trading day.

Three. ring. circus.
 
The SEC walked into a private trading firm last week and asked them to explain to them how levered ETFs work
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Probably all lawyers..... Imagine chatting up a lawyer in his office and asking "Whazzup with that due process thingy" and not getting a bill.
 
Quote from nutmeg:

The SEC walked into a private trading firm last week and asked them to explain to them how levered ETFs work
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Probably all lawyers..... Imagine chatting up a lawyer in his office and asking "Whazzup with that due process thingy" and not getting a bill.
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Did you just miss the point or was that a messed up segway?

The SEC is nothing but lawyers. Nobody there who actually has a finance or economics background and a brain at the same time.
 
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