If OTC Derivatives reform is passed as it is in the Senate there is a real chance the majority of OTC derivative trading that goes on today in the US will move offshore. This might sound like a great outcome to those that believe derivatives are the root of all evil, however the reality is that would eliminate jobs, millions in tax dollars, make credit considerably harder to come by and actually remove transparency from the market as US regulators would have little control. My comments on ABC News:
“This is not just posturing,” insisted Kevin McPartland, a senior analyst with the TABB Group, a New York City based financial markets research firm. “We have had conversations to show there is real concern in the banking community. The laws are extreme enough that banks would have little choice but to move some, if not all, of their derivatives business offshore.”
“In an effort to further regulate derivatives and proprietary trading, the U.S. could actually lose oversight,” TABB’s McPartland said.