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2 edition of Reform of the over-the-counter derivative market found in the catalog.

Reform of the over-the-counter derivative market

United States. Congress. House. Committee on Financial Services.

Reform of the over-the-counter derivative market

limiting risk and ensuring fairness : hearing before the Committee on Financial Services, U.S. House of Representatives, One Hundred Eleventh Congress, first session, October 7, 2009

by United States. Congress. House. Committee on Financial Services.

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Published by U.S. G.P.O., For sale by the Supt. of Docs., U.S. G.P.O. in Washington .
Written in English


Edition Notes

Other titlesReform of the over the counter derivative market
Classifications
LC ClassificationsKF27 .B5 2009x
The Physical Object
Paginationiv, 215 p. ;
Number of Pages215
ID Numbers
Open LibraryOL24416517M
ISBN 100160858607
ISBN 109780160858604
LC Control Number2010478489
OCLC/WorldCa644731179

Over-the-counter (OTC) or off-exchange trading is done directly between two parties, without the supervision of an is contrasted with exchange trading, which occurs via exchanges.A stock exchange has the benefit of facilitating liquidity, providing transparency, and maintaining the current market an OTC trade, the price is not necessarily publicly disclosed. entitled Over-the-Counter Derivatives Markets and the Commodity Exchange Act. One of the most dramatic changes in the world of finance during the past fifteen years has been the extraordinary development of the markets for financial derivatives.

REGULATING THE INVISIBLE: THE CASE OF OVER-THE-COUNTER DERIVATIVES Colleen M. Baker* In this Article, I focus on the regulation of the over-the-counter (OTC) derivative markets. I argue that current reform proposals and draft legisla-tion fall short of Cited by: 7. A lifi i f h Cii C di Df l SAmplification of the Crisis: Credit Default Swaps 1) Buyer of credit protection pays periodic fee. 2) If the reference credit defaults, protection-buyer delivers reference credit to protection-seller, in return for a payment of principal amount on the bondpayment of principal amount on the bond.

OTC derivatives—A primer on market infrastructure and regulatory policy Ivana Ruffini and Robert S. Steigerwald Introduction and summary Derivatives have long been important tools for manag-ing risk. In particular, as Culp () explains, “deriva-tives can be used as a means of engaging in risk transfer.   Testimony Concerning the Over-the-Counter Derivatives Markets Act of by Chairman Mary L. Schapiro U.S. Securities and Exchange Commission. Before the House Committee on Agriculture Septem I. Introduction. Chairman Peterson, Ranking Member Lucas, Members of .


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Reform of the over-the-counter derivative market by United States. Congress. House. Committee on Financial Services. Download PDF EPUB FB2

Comparing G Reform of the Over-the-Counter Derivatives Markets Congressional Research Service 2 Group of Twenty (G) The Group of Twenty, or G, is an informal forum for advancing international economic cooperation among 20 major advanced and emerging-market countries, consisting of the following members: Argentina, Australia, Brazil,File Size: KB.

Over-The-Counter Derivatives The Federal Reserve Bank of New York works to promote sound and well-functioning financial systems and markets through its provision of industry and payment services, advancement of infrastructure reform in key markets and training and educational support to.

Second, I believe regulatory reform must now bring sunshine to this opaque over-the-counter derivatives market. Over-the-counter derivatives are traded out of sight, not only of the federal. Get this from a library. Reform of the over-the-counter derivative market: limiting risk and ensuring fairness: hearing before the Committee on Financial Services, U.S.

House of Representatives, One Hundred Eleventh Congress, first session, October 7, [United States. Congress. House. Committee on Financial Services.].

Throughout the debates about reform of the OTC derivatives market, a persistent theme has been concern that the market is opaque.

Discussions of market transparency generally recognize the multiple audiences that seek information about a market--market participants, the public, and authorities--and the multiple dimensions of transparency itself. An essential element of reform is the establishment of a comprehensive regulatory framework for over-the-counter derivatives, which under current law are largely excluded or exempted from regulation.

As the AIG situation has made clear, massive risks in derivatives markets have gone undetected by both regulators and market participants. OTC derivatives reform 2 The pivotal role of Derivatives in the Capital Markets Derivatives offer significant benefits to the global capital markets such as aiding price discovery, managing risk, adding to liquidity, improving market efficiency for the underlying asset.

Reform of Over-the-Counter (OTC) Derivatives Markets in Canada: Discussion Paper from the Canadian OTC Derivatives Working Group 1. Introduction The G commitments for improving the infrastructure of OTC derivatives markets contain the following elements over-the- counter Markets.

an over-the-counter (otc) market does not use a centralized trading mecha­ nism, such as an auction, specialist, or limit-order book, to aggregate bids and offers and to allocate trades. instead, buyers and sellers negotiate terms privately, often in ignorance of the prices currently available from other po­File Size: 95KB.

The derivatives market is the financial market for derivatives, financial instruments like futures contracts or options, which are derived from other forms of assets. The market can be divided into two, that for exchange-traded derivatives and that for over-the-counter legal nature of these products is very different, as well as the way they are traded, though many market.

Congress directly addressed the governance of the derivatives markets through the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank; P.L.

; J ). This Act, in Title VII, sought to bring the largely unregulated over-the-counter (OTC) derivatives markets under greater regulatory control and : James K. Jackson, Rena S. Miller. REFORM OF THE OVER-THE-COUNTER DERIVATIVE MARKET: LIMITING RISK AND ENSURING FAIRNESS Wednesday, October 7, U.S.

HOUSE OF REPRESENTATIVES, COMMITTEE ON FINANCIAL SERVICES, Washington, D.C. The committee met, pursuant to notice, at 10 a.m., in roomRayburn House Office Building, Hon. Barney Frank [chairman of the committee] presiding. Washington lawmakers are, for instance, debating reforms to the opaque U.S.

OTC derivatives market that would include the use of central clearinghouses to reduce systemic : Julie Segal.

Regulatory Reform of the Australian Over- The-Counter Derivatives Market Ryan Rasiah Gengatharen* The Australian Companies and Securities Advisory Committee recently recommended a raft of changes to the regulation of derivatives in Australia.

This article critically examines the proposal to extend statutory regulation to the over-the-counter.

Figure 1. Derivatives Market Structures: Exchange and Over-the-Counter (OTC) Source: CRS. In the OTC market, as shown in the right side of Figure 1, there is a network of dealers rather than a centralized marketplace. Firms that act as dealers stand ready to take either long or short positions, and make money on spreads and fees.

Moreover, the structural characteristics of the over-the-counter derivatives market itself amplified the shocks created by the housing bust in several ways. First, the collateral calls generated by sharp movements in the mark-to-market value of the OTC derivative trades drained liquidity buffers and provoked the fire sales of assets.

The chapter focuses on financial transactions, addressing over-the-counter (OTC) trading of derivatives, which many analyses of the recent financial crisis argue produced significant problems. This area of financial activity grew massively from the s facilitated by legal developments both in the United States and the United Kingdom that ruled out any state regulation of the market while at.

While derivative financial instruments have made the hedging and exchange of risk more efficient, the recent crisis showed that they also pose a substantial threat to financial stability in times of systemic turmoil.

Underlying much of this threat is the lack of transparent reporting in the over-the-counter market for these by: 3. Reform of Over-the-Counter (OTC) Derivatives Markets in Canada: Discussion Paper from the Canadian OTC Derivatives Working Group Notice - Tuesday, Octo(ET) Today, the Canadian OTC Derivatives Working Group published a paper that sets out preliminary recommendations for implementing Canada's G commitments related to OTC.

Abstract of "Regulatory reform of over-the-counter derivatives: an assessment of incentives to clear centrally", a paper analysing whether the post-crisis regulatory reforms developed by global standard-setting bodies create appropriate incentives for different types of market participants to centrally clear OTC derivatives contracts.

Council on Foreign Relations (CFR), Jan. 6, -- In this meeting of the C. Peter McColough Series on International Economics, Gary Gensler, chairman of the U.S. Commodity Futures Trading Commission, discusses reform of the over-the-counter derivative marketplace.

He argues that to address the risks associated with interconnectedness, standard OTC derivatives should be moved .OTC Derivatives and the Dodd-Frank Act [].

Among the provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act of are mandates to create a framework for regulatory oversight of swaps and OTC derivatives. The SEC is to have jurisdiction over "security-based swaps;" the CFTC will regulate all other swaps.

For more information on definitions of swap-related terms, see the.Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank). Of all the areas legislated within Dodd-Frank, the approximately $ trillion 1 (notional) over-the-counter (OTC) derivatives market is arguably subject to the most significant transformation.

Seeking greater accountability and transparency, Title VII of.