Comment Text:
I want to make my position clear: the CFTC's decision to void swap derivative reporting requirements for multiple years is a threat to the global financial system.
This inaction allows massive firms to make the same risky and overleveraged bets that Bill Hwang's Archegos was exposed to resulting in its explosion. It is also worth saying that the financial system is still feeling the repercussions of Archegos (what could have been a small and isolated event if swap reporting was more rigorous) with one example being Credit Suisse over the last year and a half.
The CFTC's decision here will inevitably lead to another explosion as large entities see an opportunity and abuse it. We have seen this chain of events (inaction -> bankers creeping into dangerous territory -> and finally a financial explosion as bad bets are eventually made) time and time again in history. A great example will always be the repealing of Glass-Steagall in 1999.
I urge you, do not allow this to happen again.
The CFTC has a duty to citizens to "Ensure the economic vitality of the commodity futures, options and swaps markets." and to "Protect market users and the public."
Blatantly ignoring the size of these swap positions because ISDA members requested it should be fraud in itself. The ISDA members requesting this are clearly doing something out of the ordinary, else they would comply like they always have.
Do what you were appointed to do, and regulate the greatest threat to our markets stability: complex swap derivatives.
Thank you.
