the visible hand

it is the theory which decides what can be observed – einstein

Derivatives crackdown: step in the right direction

Posted by ecoshift on May 14, 2009

U.S. regulators seek OTC derivatives crackdown | Reuters
By Charles Abbott and Kevin Drawbaugh

WASHINGTON (Reuters) – The Obama administration moved on Wednesday to exert more control over the shadowy over-the-counter derivatives market, now closely linked to the global credit crisis.

Federal regulators proposed subjecting all over-the-counter derivatives dealers — whose trades are not made through an exchange, making them hard to monitor — to “a robust regime of prudential supervision and regulation,” including conservative capital, reporting and margin requirements.

The plan, sketched out by Treasury Secretary Timothy Geithner and top regulators at a news conference, marks a big step in the administration’s push to rewrite rules for banks and financial markets in response to a credit crisis that has sent economies around the globe reeling.

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