By GRETCHEN MORGENSON NOSTALGIA is running high on Wall Street for the days when junk mortgage underwriting and opaque derivatives trading juiced bank profits. As regulators continue to devise the machinery of the Dodd-Frank regulatory reform law, major financial institutions are working overtime in Washington to bring the good times back again. Unfortunately for taxpayers, […]
By BINYAMIN APPELBAUM WASHINGTON — John Walsh voiced the frustrations of many bankers when he warned in a speech last month that federal regulators were not paying attention to the cumulative impact of new rules and restrictions, jeopardizing the ability of banks to support economic growth. “I might have titled these remarks, ‘Beware of the […]
By BEN PROTESS The $600 trillion derivatives market, long known for its freewheeling ways, is slowly being tamed. The Commodity Futures Trading Commission proposed rules on Wednesday that would force hedge funds and other firms that trade the opaque products to bolster their capital cushion, the latest effort by regulators to curb risky behavior that […]
By JESSE EISINGER The most notable thing about the first news press conference ever of the Federal Reserve chairman, Ben S. Bernanke, last week was what wasn’t discussed: banking regulation. We hardly need more evidence that the most powerful banking regulator in the world, one that became even more powerful after financial reform was […]
By BEN PROTESS With or without new rules, the derivatives industry is gearing up for big changes. Three years ago, the complex securities wreaked havoc on Wall Street, prompting Congress to overhaul the long-unregulated market. The Dodd-Frank financial regulatory law requires companies to trade credit-default swaps and many other derivatives contracts through regulated exchanges or […]
By BEN PROTESS Federal regulators on Thursday adopted the first in a series of new rules for the derivatives market, giving the government broad new authority over the $600 trillion industry that played a central role in the financial crisis. The rules, approved unanimously by the Commodity Futures Trading Commission, greatly expand the government’s ability to […]
The Volcker rule, which bans US banks from trading for their own account, is set to include exemptions that some officials fear will weaken its impact, people familiar with the situation have warned. Read the full story at The Financial Times
History’s first recorded oil speculator set up shop some 2,500 years ago. His name was Thales, and his business was olives, not petroleum. As Aristotle writes, Thales was a philosopher and, an amateur meteorologist, and, after forecasting a bumper olive crop, he trolled from farm to farm buying up the presses used to squeeze the […]
Sometime soon, the Treasury Department will make a seemingly obscure determination about how to regulate the $4-trillion-per-day market in “swaps” used to hedge against swings in currency values. The issue at hand: Does a shadow market for these derivatives pose risks similar to those of the credit-default swaps that nearly destroyed Wall Street in 2008? […]
By Kevin G. Hall and Robert A. Rankin | McClatchy Newspapers McClatchy Newspapers WASHINGTON — Feel like you’re being robbed every time you fill the gas tank? Not sure who to blame? Try Wall Street. That’s not the conventional explanation, but it’s the one the facts point to. Usually analysts say today’s high prices stem […]
By Kevin G. Hall | McClatchy Newspapers McClatchy Newspapers WASHINGTON — Most Americans don’t know who Gary Gensler is or the agency he runs. They should. It falls to him as the chairman of the Commodity Futures Trading Commission to rein in the flood of speculative money flowing into financial markets that many experts fear […]
WASHINGTON (MarketWatch) — Republicans and Democrats continue to fight over the budget of securities and commodities regulators as President Barack Obama released his fiscal 2012 budget proposal on Monday, with consumer groups charging that a GOP plan for funding cuts would require “devastating” layoffs. President Barack Obama sent Congress a $3.7 trillion budget for fiscal […]
WASHINGTON (MarketWatch) — The Treasury Department on Friday proposed an exemption for the multi-trillion-dollar foreign exchange swap market from new post-financial-crisis rules, insisting that imposing new regulations on the market would have “serious negative economic consequences.” Corporations use foreign exchange swaps, or forex swaps, to hedge their bets in response to currency volatility. Without an […]
Former Federal Reserve Chairman Alan Greenspan said the Dodd-Frank financial reform bill had the potential to become the “largest regulatory-induced market distortion” since 1971 in a Wednesday op-ed for the Financial Times, leaving some financial experts astounded. Greenspan took particular aim at the decision — currently under debate at the Treasury — to regulate the […]
The Treasury Department plans to exempt foreign exchange derivatives from new Wall Street reform regulations, a Treasury official said Friday, dismissing concerns that the market prompted $5.4 trillion of emergency support from the Federal Reserve in late 2008. Assistant Secretary for Financial Markets Mary Miller told reporters on Friday that the foreign exchange market already […]
Barclays will be targeted during its annual meeting on Wednesday by anti-poverty campaigners accusing it of playing a leading role in driving up food prices on global commodities markets. Barclays Capital, the investment banking arm of the high street bank, is the UK’s biggest player in food commodity trading, and one of the top three […]
By Tom Braithwaite in Washington The US Treasury has opted to exempt foreign exchange swaps from sweeping new derivatives rules, providing a big victory for dealers and a defeat for the proponents of more far-reaching market reforms. Last year’s Dodd-Frank regulatory overhaul gave Tim Geithner, the Treasury secretary, the power to decide that over-the-counter forex […]
Tensions at one of the top US watchdogs charged with implementing key reforms of the derivatives markets spilt into the open on Tuesday as a regulator blasted the process as having “no specific plan or strategy”. The comments were made by Scott O’Malia, one of five commissioners at the Commodity Futures Trading Commission and one […]
A bipartisan, bicameral group of New York lawmakers on Tuesday urged regulators not to implement a new rule governing financial derivatives for fear it would harm U.S. competitiveness abroad. In a letter, lawmakers asked regulators to reconsider proposed regulations that would set new margin requirements for derivatives trades between non-U.S. subsidiaries of U.S. financial institutions […]
CQTreasury Secretary on Monday urged international regulators to follow the United States’ lead and toughen oversight of financial derivatives. “Just as we have global minimum standards for bank capital — expressed in a tangible international agreement — we need global minimum standards for margins on uncleared derivatives trades,” Geithner said in prepared remarks at the […]
With allegations mounting in the US that banks have overcharged pension funds for foreign exchange transactions, mutual fund investors are asking whether they are being fleeced too. The latest lawsuit was filed by the Southeastern Pennsylvania Transportation Authority, which accuses Bank of New York Mellon of bilking its pension fund during forex trades. The court […]
By Jesse Hamilton – Jul 15, 2011 12:01 AM ET To authors of the Dodd-Frank Act, the credit-rating industry was a chief villain of the 2008 financial crisis. As a result, the law instructed U.S. regulators to strip use of credit ratings from their rules. What Dodd-Frank didn’t decide was what should take the place […]
Teasury Secretary Timothy Geithner is close to a decision to exempt the $4 trillion-a-day foreign-currency market from key provisions of the Dodd-Frank Act requiring greater transparency in the trading of derivatives. In the horse-trading over the final conference version of that legislation last year, both Geithner and financial-industry executives lobbied extensively to give the Treasury […]
WASHINGTON (MarketWatch) — Financial activity in the futures market can significantly destabilize oil prices, a Belgium-based academic told the U.S. futures regulator on Friday as part of a debate the agency held as it weighs new rules. “In 2007 and 2008, destabilizing financial activity caused oil prices to respectively over- and undershoot their fundamental values […]
By Gregory Meyer in New York A Washington hearing room was rapt last week as a man lectured on commodities markets. Money pouring in from investors had precipitated the “financialisation” of the sector. “Flows in these markets are having major effects on prices,” he said. “That’s the takeaway.” But the speaker was not a populist […]
WASHINGTON, Aug 4 (Reuters) – The U.S. futures regulator finalized on Thursday new measures on swap data collectors and guidelines for whistle-blowers as it races to meet its obligations required under last year’s financial market overhaul law. The Commodity Futures Trading Commission is far behind schedule in a frenzy to complete nearly 50 rules. The […]
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“We don’t know what exactly was done by Kweku Adoboli, the man accused of being a “rogue trader” at UBS, but the bare facts of his life are significant in themselves. A 31-year-old Ghanaian, who went to school and university in the UK, worked in the City of London on an international equity derivatives trading […]
“’If the euro fails, then Europe fails.’ Angela Merkel’s staunch defence of the single currency, made in the Bundestag this month, is widely shared by other European leaders. The German chancellor’s sentiment demonstrates the political will not to let Europe’s sovereign debt crisis undermine the single currency.” Read the full article at The Financial Times
“The European Central Bank still has plenty of ammunition left in its monetary policy bandoleers. The question is whether it will use it.” Read the full article at The New York Times
“The governing board of Alabama’s most populous county voted Friday to accept an agreement on how to restructure more than $3 billion of debt, avoiding what could have been the biggest municipal bankruptcy filing in American history.” Read the full story at The New York Times
“Americans’ wealth declined this spring for the first time in a year, as stocks and homes fell in value, a Federal Reserve report said Friday. At the same time, corporations increased the size of their cash stockpiles.” Read the full story at The New York Times
“The American political discussion has finally turned to the right target: jobs.” Read the full story at The New York Times
“The scandal at UBS AG is casting a harsh spotlight on a corner of the financial world—so-called Delta trading—that Wall Street has been counting on to boost revenue in the wake of a financial crisis.” Read the full article at The Wall Street Journal
“UBS AG’s disclosure that a rogue trader blew a $2 billion hole in its balance sheet could not come at a worse time for the European banks, which have spent much of the past two years trying to water down regulatory crackdowns and demonstrate that they can effectively manage risk.” Read the full article at The […]
“A report from the Securities and Exchange Commission’s internal watchdog will recommend that the Justice Department review whether the SEC’s former top lawyer broke conflict-of-interest laws, according to people familiar with the matter.” Read the full story at The Wall Street Journal
“… the longtime former J.P. Morgan banker isn’t fazed by an industry often characterized by arcane terms and obscure practices. This past spring, he urged investors in meetings aimed at drumming up support for a big share offering to consider his expertise in a field long overlooked at AIG and elsewhere: risk management, which Mr. […]
“Officials in Jefferson County, Ala., voted Friday to accept a deal with holders of $3.14 billion of county debt, avoiding at least for now what would have been the largest municipal bankruptcy in U.S. history. The County Commission’s vote caps three years of on-and-off negotiations with J.P. Morgan Chase & Co. and other banks to […]
“Corporations have a higher share of cash on their balance sheets than at any time in nearly half a century, as businesses build up buffers rather than invest in new plants or hiring. Nonfinancial companies held more than $2 trillion in cash and other liquid assets at the end of June, the Federal Reserve reported […]
“An alleged trading scheme at UBS AG went undetected for three years before it was finally discovered, triggering a $2 billion loss, U.K. authorities indicated Friday as they charged a 31-year-old trader at the Swiss bank with fraud.” Read the full story at The Wall Street Journal
“Treasury Secretary Timothy F. Geithner delivered an unusually direct plea for action to his counterparts in Europe on Friday, urging leaders to move with more unity to head off a potential new wave of financial crisis on the continent. But he got a chilly response. There was no accord on new steps to address the […]
The Federal Deposit Insurance Corporation took an important step this week toward getting big financial institutions, foreign and domestic, to submit resolution plans — also known as living wills or funeral plans — as required by the Dodd-Frank Act. If the new, so-called orderly liquidation authority is going to work, it is going to depend on F.D.I.C.’s ability […]
“UBS AG’s disclosure that a rogue trader blew a $2 billion hole in its balance sheet could not come at a worse time for the European banks, which have spent much of the past two years trying to water down regulatory crackdowns and demonstrate that they can effectively manage risk.” Read the full article at […]
A leading US regulator has warned that the US “cannot be the world’s financial policeman” amid fears over a divergence between global authorities on rules reshaping the derivatives industry. Scott O’Malia, a member of the US Commodity Futures Trading Commission, acknowledged industry concerns about the potential for cross-border disagreements on rules surrounding clearing and trading […]
Wall Street’s self-regulator is stepping up its bid for more power, telling Congress on Tuesday that it is well equipped to replace the Securities and Exchange Commission as overseer of the investment advisory industry. The Financial Industry Regulatory Authority, or Finra, which already examines some 4,500 broker dealers, now wants to add more than 11,000 […]
When a $225 million loan to BNP Paribas comes due Thursday at Legg Mason’s Western Asset management unit, managers at its money market funds will be exercising caution. Instead of renewing the loan as they would have as recently as two months ago, they are looking to park investors’ money elsewhere, avoiding BNP and other Continental banks in favor of […]
“Like a magician facing a weary audience, Bank of America faces pressure to pull another rabbit out of its hat.” Read the full article at The New York Times
“Fears about Europe’s deteriorating finances intensified on Sunday as new doubts about the health of French banks, as well as Germany’s willingness to help Greece avert default, left investors bracing for another global stock market downturn this week.” Read the full article at The New York Times
“The stock market just can’t seem to make up its mind. Day after day, stocks swing sharply by hundreds of points. Last week they tumbled 3 percent in the first 90 minutes of trading on Tuesday morning, then on Wednesday closed nearly 3 percent higher and dropped almost 3 percent on Friday. All of this […]
“European banks are facing increasing strains on their balance sheets because of the dramatic jump in the cost to borrow dollars, essential for some institutions as they need to repay loans in US currency.” Read the full story at The Financial Times
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