Comment Text:
Submitter Info:
First Name: William
Last Name: Barclay
Mailing Address: 150 N. Lombard
City: Oak Park
Country: United States
State or Province: IL
Postal Code: 60302
Organization Name: Dr. William Barclay
Dear Chairman Gensler:
Re: End-User Exception to Mandatory Clearing of Swaps (RIN 3038-AD10)
The big banks and their allies are pushing for changes in the transparency requirements of Dodd-Frank that would throw important trades back into the shadows. Specifically, they are calling for exemptions for a very broad array of companies from the clearing and margin requirements of the act.
Dodd-Frank already contains an exception for legitimate end-users, such as airlines and farmers, who are doing commercial hedging as part of their business from clearing and exchange trading requirements.
We must not broaden this narrow, commonsense exception to include financial and commercial institutions that want to gamble in the derivatives markets. Doing so would allow systemically important companies to enter into risky trades in a market with zero transparency and accountability.
This is exactly the kind of murky shadow banking that led to the meltdown - as every objective observer of our present financial situation well knows. Please implement Dodd-Frank as written and do not give in to the pressure to weaken the legislation in the rulemaking process.
Please note that I write as someone who worked for 22 years in the financial services industry. It is clear, both from my experience and from events over the past few years, that self-regulation by the industry provides insufficient safeguards. Therefore we need this kind of regulatory opversight. For the foreseeable future it is better to err on the side of too much rather too little regulation.
