Tuesday, July 11, 2017

Swaps Rules to Get Revamp

Headline of a piece in today's Wall St Journal.  The global swaps market is $486 TRILLION.  Yikes.  I consider "swaps" to be a form of Wall St gambling.  Wall St is supposed to raise money to grow the economy, build factories, finance new construction, buy inventory, stuff that employs people and creates salable product.  Even the Journal was unable to describe how a "swap" works. 
   Much of the piece was about the Consumer Futures Trading Commission (CFTC)  whining about the sales data  being furnished to them by privately owned swaps data repositories.  As you might have guessed, each repository furnishes data in a different format.  CFTC hasn't bothered to write data swabber programs to put all the data into a common format for CFTC's programs.  Tough cookies CTFC.  Get your act together and fix the problem, don't waste everyone's time whining about it. 
   Apparently after Great Depression 2.0 Congress set up the reporting requirements "to help unwind failing market participants that posed a risk to the entire system"  By which they mean the taxpayer will bail out the swaps sellers next time the market goes south.  Why in God's name do we want to give a US government guarantee to Wall St gambling debts?  Let 'em go broke. 
   Our government at work.

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