Do people listen to podcasts about financial reform? I hope so. I’m a regular listener of Planet Money’s podcast, so hopefully that means at least someone might listen to me talking derivatives on their iPod (not that I put myself in the league with Planet Money, but know you know what I mean). In June 2011 at […]
Category: Commentary
Greece Won’t Kill CDS, Dodd-Frank Will
(also posted on TabbFORUM.com) Greece is defaulting on its loans. OK, technically, that’s not true. The official version is that Greece’s creditors have agreed to a “voluntary” haircut of 50 percent on the outstanding debt. The word voluntary is key. Because the haircut is technically voluntary, a credit event will not be triggered, which means […]
Old Trading Strategies brought to the New Swaps Market
When automated market-making meets an already liquid market backed by real money trades, arbitrage opportunities quickly follow, which is the direction most liquid portions of the swaps market are moving. Even in this pre-regulation implementation time that continues to linger, adoption of electronic trading is finally starting to gain momentum. Data from Bloomberg, CreditEx and […]
Derivatives reform a bright spot? Who would've guessed?
A bank collapse was the catalyst for the reforms currently underway in the OTC swaps market. Debates over liquidity killing regulations and overly burdensome implementation costs are now the norm. But guess what? The swaps market looks like a shining beacon of hope compared to the rest of the finical markets and the global economy. […]
The Path to Transparency
Managing the vast quantities of data born into existence by the Dodd Frank Act and related regulation will present a challenge in the post-DFA environment; but collecting and producing the required data is just the tip of the iceberg. The ability to analyze and act on that data is what will separate the survivors from […]
The Anatomy of a Swaps Trading Infrastructure
For the biggest swaps dealers, creation of their new OTC derivatives infrastructure will include rebuilding existing platforms, buying key elements from technology providers, leveraging technology already in place in other asset classes and, of course, building new platforms from scratch. This is not a buy-versus-build decision—it’s a careful balancing act of process and technology decisions […]
My Senate Homework from "SEFs – A Progress Report"
Also published at TabbFORUM.com On June 29, I testified before the Senate Committee on Banking, Housing and Urban Affairs Subcommittee on Securities, Insurance, and Investment. Chairman Tim Johnson (D-S.D.) followed up with some questions. Following are Johnson’s questions and my answers formally submitted for the record. 1. The reporting requirements that the CFTC/SEC has proposed for all […]
It Takes Energy – HFT in the Energy Market
The presence of principal trading groups (PTGs) in the exchange-traded derivatives market, and their absence in thecredit and rate swaps markets, are both the cause and effect of turnover frequencies. TABB Group estimates that proprietary trading (including bank proprietary trading) accounts for 55 percent of futures trading by contract volume and 41 percent of U.S. […]
My Senate Testimony on Swap Execution Facilities
This is my written testimony for the Senate Banking Committee hearing on July 29, 2011 focused on Swap Execution Facilities. What I actually said at the hearing was a subset of this. You can watch (rather than read) the entire hearing on the Senate Banking Committee website here. —– Chairman Reed, Ranking Member Crapo, and […]
Why Twitter is Not Just for Kids
Also posted at TabbFORUM.com One hundred million investment dollars tells us that Twitter is not just for kids. I’m not talking about Twitter’s ability to sell ads or stage a Linkedin-style IPO, but the presumably informed institutional investors who’ve decided to bet their money on Twitter’s ability to crowd source the direction of the Dow. […]