The Derivative Project

Sometimes Goliath Can Learn From David – Emerging Market Economies Model For OTC Derivative Regulation

In early August, the Reserve Bank of India released a report on their future plan for regulation of OTC derivatives and regulated exchanges. It is clear, in a thoughtful regulated experience there can be a role for OTC derivatives.  Unfortunately, the Wall Street spin machine continues to equate regulation with…

Why The Average American Is Following The Derivative Project – Mainstream Media Is Clouding The Real Issues

The average American understands economic hardship, high unemployment and recent graduates who have paid for a top-notch education and cannot get employed.  Retirees understand the impact of a stock market that stole their retirement through depleted 401K balances, with no financial advisor telling them to stay on the side-lines with…

FCIC’s Preliminary Report Defines Counterparty Credit Risk and Its History from a Regulatory Overview

The Financial Crisis Inquiry Commission (FCIC) released a Preliminary Report in June, 2010.  If one reads through the history of OTC Derivatives, buried in the history is the subject of “counterparty credit risk” and OTC derivatives’ exemption from the Commodity Exchange Act. FINANCIAL CRISIS INQUIRY COMMISSION PRELIMINARY STAFF REPORT –…

Department of Justice – How Obvious Is The Fraud? and Future of OTC Derivative Markets

New York Times story. Secretary Paulson told Congress the funds would be used to buy up mortgages to “help the American consumer.”  They were not.  They funds were given to counter parties, on credit default swap collateral calls, to Goldman Sachs, among other banks. Here is the description from the…

Background Information On Pending Rule Changes on Ag Swaps

The subcommittee responsible for implementing rule changes from the Dodd-Frank Reform laid out the issues in the agricultural swap area and the decisions that must be made, allowing for public comment.  Here is the Commodity Futures Trading Commission’s Agriculture Committee’s report outlining the issues for regulatory Excessive Speculation in Wheat…

Take Notice DOJ – Goldman Started The Lawsuits On Legal Enforcability

The Financial Times reported this morning, that Goldman Sachs is suing a French Bank on “cancellation” of some credit default swap contracts. “Goldman Sachs is embroiled in a lawsuit with a French bank over whether Natixis is able to terminate protection purchased by the US investment bank in relation to three…