Political Quotes

“a key part of the bill we are considering is title VII, which we all know addresses the regulation of the over- the- counter--OTC--derivatives markets. While there is still debate among us regarding the root cause of the financial crisis, there is no debate that the lack of transparency in the OTC derivatives market was a contributing factor to the financial debacle. When Lehman Brothers failed, there were press reports that banks and other large financial institutions had written credit default swaps--we call them CDSs--on Lehman Brothers that could potentially result in $360 billion in cash payouts. As it turned out, though, the number was less than $6 billion. But a lot of needless anxiety preceded the realization that the cash payouts on Lehman Brothers' CDS contracts were manageable. The regulators simply did not have the information they needed to know about the magnitude of the problem they faced. Limited regulatory information also played a role in the demise of AIG.”