Congress Told Clearing Not A Fit For All Derivatives

Law360, New York (June 5, 2009, 12:00 AM EDT) -- While a clearing facility could potentially increase transparency and efficiency in the over-the-counter derivatives market, a group of market participants and observers told a congressional subcommittee that forcing all OTC derivatives into exchanges could have a potentially disastrous effect on companies participating in the market.

In particular, panelists told a hearing of the House subcommittee on capital markets, insurance and government sponsored enterprises that attempting to force highly customized OTC derivatives onto exchanges could have the effect of increasing costs and administrative burden for companies that...
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