Financial Regulatory Forum

EU’s Barnier pledges to tackle speculators

By John O’Donnell

BRUSSELS, March 17 (Reuters) – The European Commission plans to propose controls on certain government debt derivatives as soon as June in an effort to crack down on speculation blamed for aggravating Greece’s borrowing problems.

Curbing speculation by hedge funds in credit default swaps, a form of debt insurance, is high on the EU’s political agenda as finance ministers consider a possible bailout of Greece, the euro zone’s most troubled economy.

On Wednesday, Michel Barnier, the European commissioner in charge of financial market regulation, said he would propose rules to control naked selling of credit default swaps — the sale of the insurance contracts to buyers who do not own the debt — as soon as June.

Speaking to members of the European Parliament who will vote the proposals into law, former French foreign minister Barnier said he would be proposing laws on naked selling and credit default swaps.

France and Germany in particular have criticised naked selling of CDS, while the United States and Britain are among countries that oppose an outright ban on the trade although they favour regulation of derivatives’ markets generally.

EU to discuss credit default swap speculation, watchdog frets

By Huw Jones and Krista Hughes

LONDON/BASEL, Switzerland, March 8 (Reuters) – European Union finance ministers will discuss next week how to dampen speculation on sovereign credit default swap markets, sources said, as central bankers worry some selling practices pose wider risks.

Greek debt has come under pressure as the country seeks to tackle a ballooning deficit and some politicians say speculators using CDSs, intended to insure against any risk of debt defaults, are amplifying the country’s problems.

“The European Commission may bring forward an initiative at the 16 March Ecofin,” an EU diplomat said.

EU examines debt speculators amid fears over Greece

BRUSSELS, March 3 (Reuters) – Officials working for European Union financial markets chief Michel Barnier will meet industry experts and supervisors on Friday to discuss debt speculators amid concerns traders are worsening Greece’s borrowing problems.

The meeting comes as political leaders attack hedge funds for speculating on Greek debt — although such trading is legal, the EU is examining curbing it with new rules and has invited the experts to give their opinion.

“We are looking at this issue very closely,” Barnier’s spokeswoman, Chantal Hughes, said. “We have called in experts to discuss.”

Divide grows on setting U.S. energy position limits

Traders work in the Crude & Natural Gas Options pit at the New York Mercantile Exchange June 10, 2009.   REUTERS/Shannon Stapleton By Christopher Doering
WASHINGTON, Sept 16 (Reuters) – The top U.S. futures regulator and two main commodity exchanges were conflicted on Wednesday over who should set tougher position limits if the the Commodity Futures Trading Commission proceeds to take action to curb market manipulation.


New U.S. commodity futures reporting may raise transparency, questions

By Alden Bentley
NEW YORK, Aug 25 (Reuters) – More transparency or too much information?

Energy traders, analysts and mom-and-pop farmers may find themselves swimming in detail on the big bets and hedges in the commodity markets, when the U.S. futures market regulator overhauls its widely-watched report on trader positions.


U.S. bill would restrict OTC derivatives holdings

USA/ By Charles Abbott and Rachelle Younglai
WASHINGTON, July 30 (Reuters) – U.S. financial regulators would gain the power to restrict holdings of over-the-counter derivatives under legislation to be crafted in the coming months, the chairmen of two House of Representatives committees said on Thursday.


New Shanghai IPOs defy speculation restraints

By Lu Jianxin and Edmund Klamann
SHANGHAI, July 30 (Reuters) – Two eye-popping debuts on the Shanghai Stock Exchange this week, its first listings in nearly a year, defied recent reforms to curb speculation and suggest China could struggle to keep asset price bubbles under control.


Two US House chairmen back mandatory OTC clearing in derivatives reform goals

WASHINGTON, July 29 (Reuters) – Over-the-counter derivatives should go through central clearing and trade on regulated exchanges as much as possible, according to a paper prepared for release by the chairmen of the U.S. House of Representatives Financial Services and Agriculture committees. The paper, obtained by Reuters, is to be unveiled Thursday and is intended as a guide for legislation to be written after Congress returns from its August recess.

Major points in the paper are:

LME, ICE say no plans to detail non-commercial positions

By Pratima Desai
LONDON, July 29 (Reuters) – The London Metal Exchange and Intercontinental Exchange said on Wednesday they had no plans to publish details on speculative positions on their contracts, despite controversy about some recent holdings at LME.


U.S. CFTC supports some limit exemptions – Gensler

CFTC Chairman Gary Gensler (file photo)By Ayesha Rascoe and Christopher Doering
WASHINGTON, July 29 (Reuters) – Commodity Futures Trading Commission Chairman Gary Gensler said Wednesday he supports exemptions from tough new investor limits for bona fide hedgers but he is concerned about allowances for those managing financial risk.