Opinion

Felix Salmon

Why did Schapiro hire Hu?

By Felix Salmon
June 23, 2009

Floyd Norris says it’s “great news” that the SEC’s Mary Schapiro has hired Henry Hu, the intellectual father of the CDS-help-cause-bankruptcies meme: it’s “another sign,” he says, “that she plans to be an effective regulator”.

Or maybe it’s just that she’s desperately trying to stake a claim in preparation for the coming fight with the CFTC over who gets to regulate credit default swaps. Maybe she’s noble — but exactly the same behavior can be adequately explained by painting it as a power grab.

Comments
3 comments so far | RSS Comments RSS

Who cares. Important thing is we don’t grant more power to the Fed, which is not accountable and is basically a bank trade group. The Fed should focus first and foremost on monetary policy. The current crisis highlights how they are not a good regulator..

Posted by Sechel | Report as abusive
 

Perhaps (as you say) it’s just a turf battle, but think: Shapiro’s fighting for SOMETHING. Any way you cut it, that’s an improvement over her years at FINRA.

 

the SEC and CFTC came to agreement already on how to split regulation of OTC products. Schapiro explained the proposed split during her hearing appereance on Monday – SEC gets security based swaps and CFTC gets interest rate, currency swaps etc. It was presented as a decision reached between the two agencies.

how did you miss that?

 

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