Opening Statement of Commissioner Michael V. Dunn before the Global Market Advisory Committee
December 9, 2009
Thank you Madam Chair for convening the Global Markets Advisory Committee. I look forward to hearing from the experts gathered today and hope that their thoughts and insights can help to inform the Commission on recently confronted bankruptcy issues and on the various OTC derivatives proposals.
It is important that we take the time to look at the global impact that the financial meltdown has had on the sector of the financial market that the CFTC regulates. We need to review the lessons learned and understand the shortcomings of our current domestic and global regulatory regimes. And, most importantly, we need work with regulators around the world to address those issues identified.
While Thomas Friedman’s notion that the “world is flat” has gained mainstream acceptance in recent years, it is also clear to me that not only does equal opportunity exist in our global marketplace, but also a degree of interdependency. What we do here in the U.S. affects markets around the world, and actions taken around the world, affect markets here. Accepting the existence of a global interdependency, we as regulators must work harder to understand developments around the world and be more cognizant of the global effects that our own actions may have.
The world’s regulatory bodies must work in harmony to address needed changes to prevent a future financial crisis, and if one does arrive, be prepared to face it on a global playing field. Today we will examine some of the concerns that became evident over the last couple of years and discuss what actions are necessary to address these issues.
Recent G-8 and G-20 meetings have resulted in Heads of State calling for the need for regulators to address excessive price volatility in the energy and agricultural products. This September the G-20 called for work by regulators in four areas: Collect data on large concentrations of trader positions on oil commodity markets; implement a data collection system covering OTC oil markets; publish more detailed and disaggregated data; and, analyze the issue of “excessive volatility” and the review of possible measures to prevent market manipulation. The International Organization of Securities Commissions (IOSCO) has re-convened its Commodity Futures Markets Task Force to address the G-20 directive.
If we are to make headway in providing true global regulatory reform, it is important that we embrace this notion of global interdependency and work together to diligently and quickly provide the world meaningful financial regulatory oversight.
Today’s meeting is a milestone in the journey to achieve that end. I thank you all for your work in this important effort.
Last Updated: June 10, 2010