Comment Text:
My short- and long-term savings and investments were devastated by the 2008 financial crisis. It doesn't help matters to know that the entire affair could have been prevented. Instead, Congress and regulatory bodies took it upon themselves to give the big banks the freedom to gamble with OUR money, knowing that because they were "too big to fail," the American people would have to bail them out if their gambles didn't pan out. Since then, only a few band-aids have been applied to the problem and there is no assurance that we are not in for a repetition. The derivatives market is a large piece of this puzzle. We must have effective regulations and enforcement in place. Otherwise, the big banks will continue to do as they choose, with potentially devastating consequences for the global economy.
Effective oversight of the $700 trillion global derivatives market is a key to meaningful reform. Because this market is inherently global, risks can be transferred around the world with the touch of a button. The proposed guidance you have issued on cross-border application of Dodd-Frank derivatives rules shows that you understand the importance of this issue. But the proposal contains multiple loopholes that could allow foreign affiliates of Wall Street banks to escape regulation. Big U.S. banks and other major U.S. derivatives users are global corporations with hundreds if not thousands of foreign affiliates. If we don’t regulate them everywhere, we can’t regulate them anywhere. Please make this guidance stronger to ensure that new Dodd-Frank derivatives protections will directly apply to the full global activities of all important participants in the U.S. derivatives markets.
