Insights/Opinions

I don’t have the expertise in this area, so what are your thoughts/opinions on the impact of this new rule? I don’t have enough background to make one myself.

http://www.bloomberg.com/news/2012-09-24/cftc-will-give-banks-2-minutes-to-accept-or-reject-cleared-swaps.html

It sounds like this stuff is moving too fast. This rule assumes that robots will be used for all swap clearing operations. However, swaps are not standardized securities like stocks; you need a human to check various details, since all trades are different. Plus, this is going to increase overhead for derivatives businesses. This means companies with the biggest economies of scale will gain an even bigger competitive advantage…