After a long roller coaster ride, legislation reauthorizing the Commodity Futures Trading Commission passed the House and Senate on December 15 after having been added to the Appropriations bill and was signed into law by President Clinton.
It will take time to sift through the details and determine the impact of the legislation (see Washington Watch), but it is certainly a landmark piece of legislation for the financial services industry. It goes a long way toward deregulating financial markets, offers greater legal certainty for over-the-counter products, and allows futures on equities both at home and abroad to be traded by U.S. customers.
An enormous amount of work has gone into this bill over the last two years and the industry is deeply grateful to Senator Richard Lugar and retired Congressman Tom Ewing, their committees, subcommittees and staff for their extraordinary leadership in bringing a number of disparate factions together. As often is the case, nobody got everything they wanted, but everyone got something. In addition to the Congressmen listed above, the people most responsible for the success of this bill are the members of the President’s Working Group, in particular, Treasury Secretary Larry Summers, Fed Chairman Alan Greenspan, CFTC Chairman Bill Rainer and SEC Chairman Arthur Levitt and their competent staffs. It was truly a cooperative effort that made this bill possible.
I again want to thank all of the members of the FIA who helped over the years to consider legislative language, develop testimony, and provide all the support necessary to push a major piece of legislation through Congress. This was a 12-year fight and the victory should be a sweet one. Without their help, we could not be an effective trade association. The FIA will continue to work with the regulatory agencies and Congress in implementing this new framework.
In addition to the new regulatory framework, a new Administration will bring big changes to Washington. While the transition team is getting a late start, President-elect Bush has already assembled an extremely talented group of advisors. We are optimistic about the quality of appointments to various financial regulatory agencies and look forward to working with them as we move into this new era of less regulated markets and greater competition.
As we start the new millennium (again), the need for an association has never been more apparent. With technology bringing the world closer together, the structure of the markets undergoing dramatic changes, exchanges going for-profit, access to markets becoming easy and swift, and innovative products, the need for information sharing, education, networking and advocacy is critical. We look forward to working with you in the coming months and years to extend the reach and acceptance of futures as a risk management tool to new markets and new participants around the world.
Best wishes for a happy and prosperous new year.
John Damgard is the president of the Futures Industry Association.