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Swaps ‘Armageddon’ Lingers as New Rules Concentrate Risk

From bloomberg.com

On a good day, 27-year-old Bobby Timberlake at CME Group Inc. (CME) in Chicago rounds up $2.5 billion from the world’s biggest traders and banks such as JPMorgan Chase & Co. (JPM) to cover their losses in the $639 trillion derivatives markets. What happens on a bad day will test new rules in the Dodd- Frank Act designed to prevent a repeat of 2008’s credit crisis. Starting in March, as much as 79 percent of derivatives trades known as swaps must be backed by collateral and go through clearinghouses such as CME Group. Traders may have to post $927 billion with Timberlake and his peers at LCH.Clearnet Group Ltd. and ... (full story)

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