TABB Group Pinpoints OTC Derivatives Regulatory Impact Of The Wall Street Reform And Consumer Protection Act Of 2009 (H.R. 4173)Submitted by Chopshop on 01/13/2010 12:34 -0500
- New Study Analyzes The Bill’s 200-Plus Pages Covering Derivatives, Outlines Potential Industry Impact And Gives A Timeline Leading To US Senate Passage
- Says New Competition Lies Ahead For Dominant Major Dealers From New Group Of Smaller, Nimble Tech-Savvy Dealers
When we dissected the BIS OTC derivatives numbers two weeks ago, we were expecting the release of the updated semiannual report to be released shortly. Luckily the BIS did not make us wait too long: the latest data indicate that the progression toward wanton expansion of risk continues unabated. Total gross notional increased by 10% from the prior reading to $605 trillion, mostly as a function of an increase in Interest Rate derivatives. Yet courtesy of an artificially "stable" and undervolatile environment based on a unprecedented extra liquidity which drowns all secondary risk indicators, the net notional risk exposure (market values) declined by 21% to $25 trillion.
From yesterday's hearing before the U.S. Senate on Over The Counter Derivatives. The full archived webcast can be found here - some perspectives from Citadel's Griffin and Robert Pickel, CEO of ISDA, but most notably a very exhaustive report from Chris Whalen of IRR. While I am not as much a proponent of regulation of CDS as Whalen is, he provides an impressive narrative of recent events which, if one were so inclined, could provide CDS-haters enough ammo to make a sufficiently strong case.
From yesterday's hearing before the U.S. Senate on Over The Counter Derivatives.