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Mon Dec 3, 2012, 01:54 AM

Wall Street finds a foreign detour around U.S. derivatives rules

http://news.yahoo.com/wall-street-finds-foreign-detour-around-u-derivatives-211103024--sector.html

Wall Street finds a foreign detour around U.S. derivatives rules
By Rachel Armstrong

SINGAPORE (Reuters) - Wall Street banks are looking to help offshore clients sidestep new U.S. rules designed to safeguard the world's $640 trillion over-the-counter derivatives market, taking advantage of an exemption that risks undermining U.S. regulators' efforts.

U.S. banks such as Morgan Stanley and Goldman Sachs have been explaining to their foreign customers that they can for now avoid the new rules, due to take effect next month, by routing trades via the banks' overseas units, according to industry sources and presentation materials obtained by Reuters.

The rules, a result of Washington's Dodd-Frank reforms, aim to prevent financial catastrophes in the over-the-counter (OTC) market - a huge, opaque market which is partly blamed for felling Lehman Bros in 2008 and fuelling a global financial crisis.

They call for U.S. banks dealing in OTC instruments, such as interest-rate swaps and cross-currency options, to effectively set aside capital against the risk of trades turning sour, execute their trades on electronic platforms and report them to U.S. authorities - requirements that worry the banks' offshore clients and threaten to drive business away from Wall Street. ...

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Response to jsr (Original post)

Mon Dec 3, 2012, 01:56 AM

1. Stomp on their fingers till they fall off the cliff/

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Response to jsr (Original post)

Mon Dec 3, 2012, 02:11 AM

2. of course our government has moved immediately to close those loopholes. yeah right nt

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Response to jsr (Original post)

Mon Dec 3, 2012, 03:06 AM

3. We have finally found a legitimate target for all those drones and viruses.

Target acquired. Fire at will.

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Response to jsr (Original post)

Mon Dec 3, 2012, 03:59 AM

4. Oh for God's sake the problem was always London. All the problems were in the overseas subsidiaries

 

It always made me wonder how Regulating the US market was supposed to stop any of what we went through.

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