Commissioner Giancarlo Discusses Wish List for the CFTC in 2015 (Energy Metro Desk) (with Lofchie Comment)
In the latest installment of the Energy Metro Desk, CFTC Commissioner J. Chris Giancarlo outlined his wish list for the CFTC in 2015. According to Commissioner Giancarlo, in 2015, the CFTC will actively complete outstanding Dodd-Frank rule implementation, fix flawed rules and work with the new Congress. However, he noted that his biggest wish is for a change in the "tone of the public debate" of CFTC-related issues that will be discussed and covered by the mainstream media.
Commissioner Giancarlo pointed out that previous reporting on post-financial-crisis reforms has generated the "constant recycling of preconceived story lines." The narrative of these "preconceived story lines" revolves around "valiant market reformers" who are trying to prevent another financial crisis, as well as "feckless toadies for Wall Street" who aim to curtail regulatory reform. Commissioner Giancarlo explained that stories with this dichotomous narrative tend to portray reforms that were put in place by regulatory agencies as "flawless at conception and . . . now sacrosanct."
Commissioner Giancarlo added that this "false narrative" is counterproductive to producing effective reforms. The narrative perpetuates the notion that Dodd-Frank rules were perfect upon publication, which Commissioner Giancarlo noted is false. Effective reforms, as defined by Commissioner Giancarlo, "perform efficiently in the reality of everyday global markets" and reduce systemic risk.
In conclusion, Commissioner Giancarlo said that, in 2015, he hopes that media coverage will be less partisan, which should lead to a "lower emotional thermostat" and allow the CFTC to begin the "necessary" process of repairing and replacing certain rules.
Lofchie Comment: The false narrative of the "perfect" law occurs not only at the regulatory level, but also at the statutory level. As noted in recent Cabinet commentary regarding the legislative amendments to the swaps push-out rules made before the end of the last session of Congress, the notion that the Section 716 amendment was a giveaway to financial institutions and a blight on an otherwise beautiful piece of legislative drafting is absurd. The swaps push-out provision of Dodd-Frank was a last-minute throw-in to a statute that was drafted in haste. If there is to be a sensible scheme of financial regulation, it will not be the result of clinging to a fictional narrative.
Click here to view the article.The above link is to an excerpt from the most recent issue of Energy Metro Desk, which is published biweekly by Scudder Publishing Group, an energy trade news publishing company based in the Washington, D.C. metropolitan area. Those who are interested in learning more about Energy Metro Desk may do so by visiting www.energymetro.com or by sending an e-mail to [email protected]. Reprinted with permission of the publisher, Scudder Publishing Group, LLC. Copyright 2014.