National Journal: Gensler the regulator most responsible for the Volcker rule
December 11, 2013 | 06:50 PM
Gary Gensler
Commodity Futures Trading Commission Chairman Gary Gensler is the regulator who pushed hardest for the Volcker Rule that was adopted on Tuesday, National Journal reported.
Gensler, who is scheduled to leave the commission at the end of the month, in a statement also said he supported the rule, but gave credit to the CFTC staff.
In a statement, Gensler said:
“The talented CFTC staff working along with my fellow commissioners — Mike Dunn, Jill Sommers, Bart Chilton, Scott O’Malia and Mark Wetjen — really have delivered for the American public.
“With this action, the staff of this small but remarkably effective agency will have completed 68 rulemakings, orders and guidances. Though lacking adequate resources, the CFTC staff has diligently sorted through nearly 60,000 public comment letters. They have met with members of the public more than 2,200 times to discuss reform.
“These common-sense reforms have been truly transformative.
“Bright lights of transparency now are shining on the $380 trillion swaps market. The public can see the price and volume of every transaction, like a modern-day tickertape. Transparent, regulated trading platforms are trading a quarter of a trillion dollars in swaps each day.
“A majority of the swaps market is now being centrally cleared - lowering risk and bringing access to anyone wishing to compete.
“Ninety-one swap dealers have registered and — for the first time — are being overseen for their swaps activity.
“I couldn’t be more proud of this dedicated group of public servants.
“I am honored to have served along with them during such a remarkable time in the history of this agency.”
Also today, Gensler gave a speech to the D.C. Bar that he described as his last as chairman. He said the unregulated swaps market was at the center of the 2008 financial crisis and that the marketplace has been “transformed” by regulators since then.
He also said, “As LIBOR and Euribor are not anchored in observable transactions, they are more akin to fiction than fact.”
“That’s the fundamental challenge that the CFTC and law enforcement agencies around the globe have so dramatically revealed,” he said. “We’ve made progress addressing governance and conflicts of interest regarding such benchmarks. But this alone will not resolve the fundamental vulnerability of these benchmarks — the lack of transactions in the interbank market underlying them. “
“That is why the work of the Financial Stability Board to find replacements for LIBOR and to recommend a means to transition to such alternatives is so critical. The CFTC looks forward to continuing work with the international community on these much-needed reforms,” Gensler said.
