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November 13, 2012
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Daily coverage for the global derivatives industry

  Top Stories 
  • MiFID II drafts cause confusion about commodity position limits
    Europe's revised Markets in Financial Instruments Directive calls for position limits for commodity derivatives, but market participants are concerned about recent drafts, saying national regulators are given too much authority for setting the limits. The situation is causing confusion about which entities will be responsible for establishing the limits, Jay Maroo writes. (subscription required) (11/13) LinkedInFacebookTwitterEmail this Story
  • DTCC weighs in on CME's lawsuit against CFTC
    Depository Trust & Clearing says it opposes a lawsuit by CME Group that challenges a requirement for exchanges to open up nonpublic reports of cleared swaps transactions to swaps-data repositories registered with the Commodity Futures Trading Commission. "DTCC is currently considering its possible responses to the suit and resulting Commission activity, including possible judicial recourse," according to a letter from DTCC to CFTC Chairman Gary Gensler. Reuters (11/12), Fox Business/Dow Jones Newswires (11/12), Bloomberg Businessweek (11/12) LinkedInFacebookTwitterEmail this Story
  Industry News and Trends 
  • Firms seek to develop pre-trade credit-checking utilities
    Traiana and MarkitServ are working to develop pre-trade utilities that will offer execution and clearing certainty under regulations governing the over-the-counter derivatives market. The post-trade-technology providers are trying to come up with a solution to market participants' concerns, but their efforts could run into other obstacles, such as risks associated with entrusting sensitive information to third-party firms. FX Week (U.K.) (subscription required) (11/12) LinkedInFacebookTwitterEmail this Story
  • Credit-risk management becomes increasingly important
    Suspect credit agency ratings and the likelihood of a sovereign-debt default in the eurozone have elevated the importance of credit-risk management. "People assumed that certain organizations that got into trouble would never get into trouble. ... The process of credit-risk management has become far more important, rigorous and demanding," Royal London Asset Management Chief Investment Officer Robert Talbut said. Consequently, insurers and asset managers can no longer rely solely on a quantitative approach. (subscription required) (11/12) LinkedInFacebookTwitterEmail this Story
  • Market experts talk HFT and swaps "futurization"
    High-frequency trading and the "futurization" of swaps were discussed by a panel at CME Group's Global Financial Leadership Conference. Representatives from GETCO, Credit Suisse and BlackRock discussed the definition of high-frequency trading, possible improvements, market stability and futures' role in the markets. SmartBrief/SmartBlog on Finance (11/13) LinkedInFacebookTwitterEmail this Story
  • Commentary: Greek default is inevitable
    No matter the combination of rescues, debt deals and austerity, Greece is bound to default, Alen Mattich writes. "The reason the Greek government can't get to grips with its deficit is because its shrinking economy is leading to higher welfare payments and lower tax revenues faster than austerity programs can shrink the gap," Mattich writes. "And austerity merely causes the economy to slow further." The Wall Street Journal/The Euro Crisis blog (11/12) LinkedInFacebookTwitterEmail this Story
  Regulatory Roundup 
  • EU lawmakers step up pace to meet Basel III deadline
    European lawmakers remain committed to implementing standards to meet Basel III capital requirements by a Jan. 1 deadline, accelerating a schedule of meetings on the subject. Even so, some lawmakers say they might have to extend the deadline to February. U.S. regulators recently said they won't be able to implement Basel III by Jan. 1. Reuters (11/12), The Wall Street Journal (11/12) LinkedInFacebookTwitterEmail this Story
  • Ever-changing regulations frustrate companies
    Companies have held off on preparing for new rules, but as a raft of measures take effect -- Basel III, a revised Markets in Financial Instruments Directive and the Dodd-Frank Act -- many might be caught off guard by their wait-and-see approach, Richard Henderson writes. Still, many firms are asking a logical question: How does one prepare for rules that still need to be solidified? The Trade News (U.K.) (11/12) LinkedInFacebookTwitterEmail this Story
  • Commentary: CFTC creates more market uncertainty
    Mark Pengelly writes in this editor's letter about recent moves by the Commodity Futures Trading Commission, including the release of a series of no-action letters to clarify the agency's enforcement stance. "The CFTC's approach is generating additional uncertainty when there is plenty for firms to deal with already," Pengelly writes. (subscription required) (11/13) LinkedInFacebookTwitterEmail this Story

The one permanent emotion of the inferior man is fear -- fear of the unknown, the complex, the inexplicable. What he wants above everything else is safety."
--H.L. Mencken,
American journalist and essayist

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