Mr. Garrett: i yield myself one minute. This is the most critical amendment we will address which addresses the derivative portion which is should we say yes or no to these derivatives. We should tell them know. Neither the administration, nor the majority or chairman has provided substantial evidence of any o.T.C. Derivatives how they caused the crisis. Derivatives is something that companies use to hedge the risk and we should make sure there is transparency and accountability. And we can do so in a way that will not hamper their ability to control costs, not to manage risk in the global marketplace. This would all hurt that. When you talk about the end users and what they're doing, remember, it was the end users, large and small, the public and private american businesses, they, they were the victims, not the cause of the financial crisis. Derivative dealers and their customers, the end users, they're in the best position to determine what are the appropriate margins requirements not giving more authority to the s.E.C. Or any other prudential regulators, i yield back. The chair: the gentleman from massachusetts is recognized. Mr. Frank: i yield myself one minute. I accept the way the gentleman from new jersey put it. Should we give the regulators more power? That is a constant theme. We look at what happened over the past 15 years and say there is was too little regulatory action because some didn't use it, like mr. Greenspan at the federal serve and some of the s.E.C., But because of not sufficient regulatory powers. It doesn't say that every trade has to be marginned. It says no trade that is to be marginned is a mistake and it is a dissneags area grant of authority to the regulators. If you think what we should do is continue a relatively wholly unregulated regime and distrust the notion of regulation to the point where you would not give them discretionary authority, and they have no authority to take away the end user exemption. Regulators, the c.F.T.C. Didn't like that. We have accepted the legitimacy of the end user exemption. But to say there shouldn't be an end user requirement is a grave error and i support this amendment.Mr. Garrett: i yield myself one minute. This is the most critical amendment we will address which addresses the derivative portion which is should we say yes or no to these derivatives. We should tell them know. Neither the administration, nor the majority or chairman has provided substantial evidence of any o.T.C. Derivatives how they caused the crisis. Derivatives is something that companies use to hedge the risk and we should make sure there is transparency and accountability. And we can do so in a way that will not hamper their ability to control costs, not to manage risk in the global marketplace. This would all hurt that. When you talk about the end users and what they're doing, remember, it was the end users, large and small, the public and private american businesses, they, they were the victims, not the cause of the financial crisis. Derivative dealers and their customers, the end users, they're in the best position to determine what are the appropriate margins requirements not giving more authority to the s.E.C. Or any other prudential regulators, i yield back. The chair: the gentleman from massachusetts is recognized. Mr. Frank: i yield myself one minute. I accept the way the gentleman from new jersey put it. Should we give the regulators more power? That is a constant theme. We look at what happened over the past 15 years and say there is was too little regulatory action because some didn't use it, like mr. Greenspan at the federal serve and some of the s.E.C., But because of not sufficient regulatory powers. It doesn't say that every trade has to be marginned. It says no trade that is to be marginned is a mistake and it is a dissneags area grant of authority to the regulators. If you think what we should do is continue a relatively wholly unregulated regime and distrust the notion of regulation to the point where you would not give them discretionary authority, and they have no authority to take away the end user exemption. Regulators, the c.F.T.C. Didn't like that. We have accepted the legitimacy of the end user exemption. But to say there shouldn't be an end user requirement is a grave error and i support this amendment.
Loading...
3:13
Garrett Silences Barney Frank on the House Floorby repscottgarrett698 views
they gonna get to the poll barn bill yet
eaglemike1515 1 year ago
@Eisen89 I'm not sure about "greatly", but I agree that we need some regulation in this regard. We need to ensure that the liability of holding some of these (epecially the credit default swaps) are known and that banks must maintain a solvency. It is important that the banks be capable of failing without taking down the economy. Banks failing *should* be a good thng; not destructive.
RobertGary1 1 year ago
I do agree with you to some extent, but thus far, we have seen that they have been abused. If we decide to keep derivatives, they have to be regulated greatly so that they are not abused like this again.
Eisen89 1 year ago
@Eisen89 Private investors probably should stay away form derivatives because they are dangerous if you don't know what you are doing. But don't throw the baby out with the bath water. Derivatives are an important tool in institutional investing to reduce risk when paired with assets.
RobertGary1 1 year ago
If these companies know how to use derivatives properly, then why did they hedge to 40-1 or greater??? This is proof that they don't really know what they're doing. Besides that, Warren Buffett said long before the crisis that investors need to stay away from derivatives because they would come to be known as the greatest destroyers of wealth in modern history. He was spot on.
Eisen89 1 year ago
I think you put the word "conservatives" where the word "liberals" should be and vice-versa.
Eisen89 1 year ago
But he's right. Derivatives, when used correctly, are used to *reduce* risk, not increase it. Removing derivatives will increase risk. I know that liberals are driven by feelings and intentions but conservatives are ruled by facts and experience.
RobertGary1 2 years ago
Scott Garrett is my congressman. He's a knuckle dragging, ultra-conservative zealot who is driven by ideology, not reason.He should move to Oklahoma where his brand of foolishness will be better appreciated
analogcorner 2 years ago