By Agri-Pulse Staff
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days of backroom Wall Street deals are over,”
clearing and trading of financial transactions lowers risks and makes the
entire financial system safer,”
proposal puts an end to ‘too big to fail’ and prevents future Wall Street
bailouts. Financial institutions will have to decide if they want to be banks
or if they want to engage in the risky financial trading that caused the
collapse of firms such as AIG,”
Chairman of the Senate Agriculture Committee,
The Senate Agriculture Committee will hold a mark-up next week on the legislation. To read or download the full legislative text of the 336 page bill, go to: http://ag.senate.gov/site/legislation.html
The Agriculture Committee’s summary of The Wall Street Transparency and Accountability Act is below.
The Wall Street Transparency and Accountability Act of 2010
Senate Committee on Agriculture, Nutrition, and Forestry, Chairman Blanche Lincoln
landmark reform legislation that will bring 100 percent transparency to an
unregulated $600 trillion market, close all loopholes and keep jobs on
Historic Reform of the Derivatives Market
Brings 100 Percent Transparency to Market with Real-Time Price Reporting:
Street will no longer be able to make excessive profits by operating in the
dark. Exposing these markets to the light of day will put this money where it
belongs – on
Lowers Systemic Risk by Requiring Mandatory Trading and Clearing:
Trading and clearing of swaps lower risks and make the entire financial system safer. Transactions, determined by the regulator, will be required to clear through a clearinghouse. In addition, these transactions must be traded on a regulated exchange, which will provide further market transparency.
Prevents Future Bailouts and Addresses “Too Big to Fail”:
Banks need to be kept in the business of banking. The taxpayer funds used to bail out AIG and other Wall Street firms will never be used for this purpose again. The Federal Reserve and FDIC will be prohibited from providing any federal funds to bail out Wall Street firms who engage in risky derivative deals.
Loopholes have allowed far too many to avoid the law of the land or set up shell companies to claim exemptions. This bill gives regulators the authority to close any loophole they find, protecting the markets, taxpayers and the economy.
Protects Jobs on
Protects Municipalities and Pensions:
dealers will have a “fiduciary duty,” just like investment advisers, that will
require the interests of municipalities and pension retirement funds be put
first; ensuring Wall Street doesn’t take advantage of
Regulates Foreign Exchange Transactions:
Foreign exchange swaps will be regulated like all other Wall Street contracts. At $60 trillion, this is the second largest component of the swaps market and must be regulated.
Increases Enforcement Authority to Punish Bad Behavior:
will be given broad enforcement authority to punish bad actors that knowingly
help clients defraud third parties or the public such as when Wall Street
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