Stabenow Emphasizes Importance of Reform to Protect Families and Businesses, and the Need to ‘Get Rules Right’ at Oversight Hearing Examining Implementation of Wall Street Reform One Year after Passage
Washington, DC – Michigan Senator Debbie Stabenow, Chairwoman of the U.S. Senate Committee on Agriculture, Nutrition and Forestry, today said new rules developed by the Commodity Futures Trading Commission (CFTC) governing financial markets must protect consumers and maintain confidence in the markets, reflecting congressional intent. Chairwoman Stabenow said the rules should create certainty for the markets, which will be critical in preventing another financial crisis like the market collapse in 2008, which left millions of Americans out of work and many more without homes or life savings.
“The work we did in Wall Street Reform, and in particular the derivatives title, was passed to protect the public, reduce systemic risk, increase transparency, and ensure companies can use these markets to hedge real business risk,” Chairwoman Stabenow said nearly one year after passage of the Wall Street Reform and Consumer Protection Act. “It remains critical that new rules reflect congressional intent. Wall Street reform must maintain market liquidity, preserve the ability of end-users to hedge and manage risk, and foster transparent, competitive markets.”
Chairwoman Stabenow pressed regulators at the CFTC oversight hearing to make sure new rules harmonize internationally with other jurisdictions, to ensure that reforms of the financial markets aren’t undermined and our companies have a level playing field. She said because of the complexity of market interactions, regulators must make sure they’re taking the time to get them right.
“These rules will significantly impact global financial markets and our economy. While we do not want to unnecessarily delay important reforms, those enforcing reform must take the time to get the rules right and ensure a level playing field internationally,” Chairwoman Stabenow said. “To that end, I would like to thank the CFTC for their commitment to phasing-in changes and their willingness to consider additional public comment, giving market participants a chance to weigh-in on the rules as a whole.”
Witnesses at the hearing included the Hon. Gary Gensler, Chairman of the Commodity Futures Trading Commission, and Dr. Michael Gibson, Senior Associate Director in the Division of Research and Statistics at the Federal Reserve Board. Additional witnesses included the Hon. Brooksley Born, Former Commissioner, Financial Crisis Inquiry Commission, Former Chairperson, Commodity Futures Trading Commission, Washington, DC; Mr. Daniel Roth, President and CEO, National Futures Association, Chicago, IL; the Hon. Charles Conner, President and CEO, National Council of Farmer Cooperatives, Washington, DC; Mr. Adam Cooper, Senior Managing Director and Chief Legal Officer, Citadel LLC on behalf of Managed Funds Association (MFA), Chicago, IL; and, Mr. John Damgard, President, Futures Industry Association, Washington, DC.
Chairwoman Stabenow’s opening statement, as prepared for delivery, is below.
Opening Statement as Prepared for Delivery
Chairwoman Debbie Stabenow
June 15, 2011
Good morning, and thank you all for being here. The Senate Committee on Agriculture, Nutrition, and Forestry will now come to order.
Thank you to our witnesses and to the public for joining us. We are here today to continue the Agriculture Committee’s oversight of Title VII of the Wall Street Reform and Consumer Protection Act. One year after passing financial regulatory reform, it’s important to take a moment to remember why Congress passed this historic legislation.
In 2008, the world held its breath as it watched financial markets collapse and global financial institutions crumble. By the time the crisis subsided, millions of jobs were lost. Not only did hardworking Americans lose their jobs, but many lost their homes, and their life savings.
Make no mistake – the United States experienced an unparalleled crisis that required bold action. The reforms in the Wall Street Reform and Consumer Protection Act, and in particular the derivatives title, were passed to protect the public, reduce systemic risk, increase transparency, and promote competition and decrease costs for companies that use these markets to hedge risk.
I look forward to today’s testimony, to hear from regulators and market participants on the implementation of Title VII. These rules and regulations will significantly impact global financial markets and our economy, which is why we must take the time to get the rules right while not unnecessarily delaying important reforms. To that end, I would like to thank the CFTC for their commitment to phasing-in the reforms, providing temporary relief for regulatory requirements and allowing market participants to weigh-in on the rules as a whole. We have seen a remarkable amount of work coming from the regulators in the past year, and I would like to commend them and their staffs for their hard work.
I have several concerns that I hope the witnesses will address today.
While we gave substantial new authority to the regulators, it will remain critical that the rules reflect congressional intent. The rules must maintain market liquidity, preserve the ability of end-users to hedge and manage risk, and foster transparent, competitive markets.
Regulators must also harmonize regulations not only domestically between agencies but also internationally with other jurisdictions. We must promote international harmonization to ensure that we do not undermine strong reforms to the financial markets.
These oversight hearings are an important part of the process. I look forward to working with my colleagues, the agencies and market participants to ensure that we never allow the failures of the past to be repeated.
I will now turn to Senator Roberts for his opening remarks.
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