Hedge funds and mortgage banks can avoid derivatives regulation by classifying their derivatives as "risk management tools". See Bloomberg article.
A Null Set’
“As just about all swaps could be defined as being used for risk management purposes, we’re concerned that unintentionally the category of ‘major swap participant’ could have been narrowed so significantly, or even to a null set,” CFTC Chairman Gary Gensler told reporters after the hearing.
A former CFTC chairwomen attempted to regulate OTC derivatives in the 1990's but was effectively censored by Summners, LEvit (who now regrets not supporting her), and Greenspan (who nows sees the folly in unregulated markets).
Links 5/7/2022
3 years ago
