do i think there's a role for cftc? i do. can cftc be effective? yes. but when their own democrat member says, and i quote again, the cftc staff, not his personal opinion, but the cftc staff which is over 700, has been unable to find any reliable economic analysis to support the contention that too much speculation has affected the market. that's not my opinion, that's what the democrat member says the cftc staff has reported. should we be concerned about speculation? yes, we should. but i don't think it's fair for any member of congress to go back home to the taxpayers and say, i'm going to bring down the price at the pump because i have put millions of dollars into a washington bureaucracy and they are really going to get tough on the wall street crowd now. if we want to bring down the price of energy in america, we have to increase our supply and i don't know of any other way to do it. supply goes up, the cost goes down. if we want to help the consumers at the pump, we have got to explore and develop our own domestic energy resources and discussion a

these cuts to cftc indicate that the majority believes that cftc can carry out its duties with even less funding this year than they had last year or that their duties aren't of great importance to the american people to begin with. for those of us who may have forgotten, the financial crisis was a result of some very bad bets. bets made by wall street firms in the unregulated, $300 trillion derivative market. the bankruptcy of lehman brother the collapse of the mortgage market, and the bailout of a.i.g. and other firms are all a result of these bad debts. the the 14 million unemployed, the still weak job market and the tremendous los of hard-earned home equity and retirement savings are also a result of these bad debts. that's why we work sod hard last congress to pass the dodd-frank wall street reform consumer protection act this act gives cftc tremendous responsibility for making sure that the public never again has to bail out the wall street firms that roll the dice with taxpayers ending up holding the bag. cftc's new response b89s are important and so is the -- responsibilities are

entities and free the cftc staff to focus on transactions that more directly affect u.s. market participants and i thank you very much for the opportunity to testify. >> thank you very much mr. damgard. you answer the first question i was going to ask you in terms of what is happening abroad and senator bob roberts and i had sent a letter and will be working together with their european counterparts and appreciate your comments on that as you can tell from the committee discussion today. we are very concerned about how all this fits together and making sure it is done in the right way. mr. cooper, being a part of a firm that is very active in these markets, i would like to hear more about your perspective on phasing in implementation in a financial regulatory reform and any potential delays. was delaying the bill create additional legal or market uncertainty in your opinion, and what sort of information or certainty from the regulators would be ideal to help your firm meet the changes required by reform? >> thank you that in chairwoman. we are today may be literally 1000

and will be working very closely with the cftc. but we cannot really complete that process and develop the guidance for our staff until the rules itself are adopted in their final form. in addition to the registration process, the cftc has proposed that all swap dealers and major swapper disciplines become members of national futures association. and our responsibility our basic responsibly would be to monitor those firms for compliance with the applicable regulation. obviously for some of the major bank firms that have prudential regulars i responsibility might be somewhat more limited. in order to take on that additional responsibility we've got to the cottage three basic undertakings that i described in my written testimony. we have to revamp our governing structure at abbottabad, pakistan make sure that our board structure has enough checks and balances to deal with the issues that i described in my written testimony. we had a committee working on that. we've made progress on that. we can't complete that process until we have f

i think that to be really effective and full implementation and enforcement of the act, the cftc needs more resources. >> thank you. senator roberts. >> mr. roth, regarding the registration of swap dealers and major swap participants, in your testimony you mentioned the cftc's proposed rules allow provisional registration for swap dealers and major swap participants before all the rules are finalized. as each rule is finalized, they would revote review compliance with the new rule by each provisional swap dealer and major swap participant. do you think this process, this professional registration process, is the most effective means of registering new swap dealers and major swap participants? could there be a better or more efficient process, in your view? >> yeah, i think the professional registration process is workable in that it's an opportunity for firms to begin the registration process while allowing the cftc to face in the requirements over a period of time. the provisional registration process provides submissions have to be -- there's not a deadline by which the submissions h

however, the size of the market that the cftc must now supervise has increased seven-fold, and the cftc needs more resources. but in this bill, we will see their budget slashed. instead of giving the agency the tools it needs to prevent another financial collapse, we are planting the seeds for the next fm crisis. the result of this republican legislation to delay reform and the underlying bill to stop this agency would allow large interconnected financial companies to engage in unsupervised activity similarto the activity that got us into -- similar to the activity that got us into this crisis in the first place. this would have an area in a similar fashion that nearly destroyed our economy. cftc chairman has warned that denying funding to this agency and delaying the implementation of dodd-frank will greatly increase the risk to american people and leave uncertainty in the marketplace. the cftc is vital to the proper functioning of our financial market and the american economy, underfunding the commission is deeply irresponsible, and i urge my colleagues to support the delauro amendmen

this congress has told the cftc to act. they have failed to act. now is the time for us to tell them exactly what must happen. thank you very much, mr. president. and, with that, i yield the floor. i suggest the absence of a quorum. the presiding officer: the clerk will call the roll. quorum call: ing officer: the senator from iowa. mr. harkin: i ask further proceedings under the quorum call be dispensed with. the presiding officer: without objection. mr. harkin: when jerry coonahan leaves the senate employment in the next couple of days we will lose one of the most respected members of our senate family. during nearly two decades of service with the senate, he epitomizes dedication, loyalty and incredible work ethic of the best staff members here on capitol hill. we're saying farewell not just to a wonderful senate employ, but also to a very good friend. mr. president, jerry coonahan first came to capitol hill as a member of senator john mccain's staff. he later left the senate for a brief time, but returned in 1997 as a tour guide in the capitol

one is the bank regulators and the cftc said and users are not required to post margin. number two, these are just proposals. you all have an opportunity, and i know your associations have spoken to the bank regulators on the point. so, these are just proposals. probably in the course of these things we will finalize these margin in rules toward the end of this year so we have some time to look at these. >> what's your relationship like with sheila bair? is she as difficult to get along with as she might seem to be? [laughter] >> i think that she has served this nation very well. i think we are all going to miss her. her last day is july 8th, and i consider myself honored to be with her. speak to the dhaka >> the july 16th deadline speaking of july, you raised a magic wand there, so to speak, in terms of dodd-frank's deadline. but there are some legal experts out there who suggested deals going forward might be challenged. are you -- are you actually leaving the the rule making up to judges in this area as a result? >> well, congress gave us one year to complete the task

but let me also quote the democrat commissioner on the cftc, michael dunn, a democrat member of the cftc. there has been a suggestion by some that once we set position limits, that's speculative limits, on physical derivatives that the price we pay will inevitably drop. i believe this is a fallacy. . today the staff has been unable to find any reliable economic analysis to support the contention that excessive speculation is affecting the markets we regulate or the position limits will prevent excessive speculation. >> will gentleman yield? mr. kingston: i will be glad to yield once my five minutes is up. the price exists in our markets because of global supply and demand for physical commodity. why are the democrats trying to get us bogged down the price of oil is going up because of speculation? i can tell you. go back to january of 2009 and ask your constituents if they remember paying $1.83 a gallon. in that same month who became president of the united states? but the president obama, the democrat. the change you are asking for, the change we were promised was that gas went from $1.

i do not think the cftc would be mandated to put people at a disadvantage if that could be clearly itsad list but the general framework is we have a problem with leverage and we got into a terrible financial crisis because we hadn't done appropriate regulation and as we do the regulation it is important to keep in mind the role of financial institutions is not to make money for themselves but to be the intermediary between various sources of capital and people who put it to good use and the need not to allow competition to be used to denigrate regulation but to try to get cooperation so that we get a good regulatory scheme that puts no one at a competitive disadvantage. >> mr. royce for one minute. >> given were a financial crisis are originated it is unfortunate how far off the radar this reform effort has gone. this all started when congress decided to embark on a social justice course to get everyone that wanted one into a home regardless of whether they could afford it. then came the crisis followed by dodd-frank. let's be clear. an avalanche of regulation doesn't mean better regu

you mentioned cftc, the s.e.c., you mentioned the fed. is the ftc involved? >> not to my knowledge, the ftc. >> what other agencies -- >> the sythes committee. we're voluntarily filing. >> anybody else that you can identify that you're submitting information to? >> i just didn't hear you say justice department. >> well we said doj at the outset. they're the big, big enchilada here, they make the final decision. what i'm not clear on is what these other agencies, what their role is. what is, let's just go one by one. s.e.c., obviously provides expertise to the department of justice. but do they have another role with reference specifically to the new york stock exchange? are you submitting information to them and are they reviewing it? and for what purposes are they reviewing it? >> yeah. they work with the foreign regulators in europe to make sure that the division of labor and there's an m.o.u. between. for example, s.e.c. and the college of regulators, even for existing exchange. it has to do with rules for exchanging information when there are investigatio

one has to require, one only has to recall the testimony of brooksley born, head of the cftc about the dangers of unregulated derivatives that were summarily dismissed by treasury secretary larry summers and fed chairman alan greenspan. but by the time gramm-leach-bliley act was passed in 1999, the regulatory architecture of the 1930s was long since dead. killed not by a set of beliefs about the ability of markets of disciplined, but by innovation. innovation occurred for many reasons. the end of the bretton woods system of exchange rates created the need for currency and swap arrangements. higher inflation rates in the 1970s inspired the development of certificates of deposit, and now i cannot i cannot. there was ongoing constant regulatory arbitrage. the drive to innovate and incredible resiliency of the shadow banking system is at the heart of my unease about the dodd-frank act. all the runs that occurred at the onset of financial crisis occurred in the shadow banking sector, runs on wholesale funding markets, money market funds and so on. and much of a dialogue around the dodd-fran

at this point, critical components of the cftc has no regulatory paralleled in europe or other major jurisdictions. as noted in greater detail in my written testimony, these rules could adversely impact u.s. competitiveness and the depth and liquidity of u.s. markets. and ironically, they will likely harm the beneficiaries of the new rules, the commercial and the users of derivatives. another important point of the divergence relates to the proposed business conduct rules the cftc's proposals to be ignored the institutional nature of the otc derivatives market. moreover the standard sees the protections required by the statute and go well beyond the regulatory framework concentrated in other jurisdictions. these rules will further impair the viability of u.s. markets. another key issue is the issue of the extraterritoriality. today there are serious concerns about the reach of the dodd-frank act and the activities that take place overseas, extraterritorial reach exacerbates the problems created by the asymmetric rules. furthermore, it is inconsistent congressional intent in limiting

i do think that this is very important and that isn't nearly what my agency has with the cftc i think it's extremely important and i hope very much that congress gives the agency the money they need to implement a very important and needed reform in the derivatives transparency and oversight. the cds market in particular continues to be too opaque for purposes of assuring assistant stability, and i -- it was a key derogatory during the crisis, and so i would hope that the funds would be available to implement the rules because they are very important. more generally again maintain the political will it is an nisha right now and a lot of pushback are obviously needed like higher capital, and one of the things i hope to do when i leave is to try to engage more generally on these issues and explain to them in terms of everyone can understand why it's important and why the need to be engaged and be paying attention to what their elected officials are doing this for because this crisis is solved and i don't want to see it repeated to the estimate one of the responses was to take the tradit

why isn't the manhattan district attorney's office, where is the department of justice, the cftc, whereeral offices that are supposed to be doing this? >> that is exactly the question that people were asking. it's great that the manhattan district attorney is looking into this. it's also great that eric snyderman is investigating a series of banks. but with all of this news, it only becomes more and more conspicuous as you say that the s.e.c. is not involved, the department of justice, all of these federal agencies should have been doing this job apparently are not. we just don't know yet. >> it's conceivable that they are doing it, we don't know. we would at the end of the day have to say, hats off to you? >> absolutely. >> and in the insider trading trials that we've heard about, they have been there and convictions in the gallion case, there was a goldman sachs board member who was paid for inside information and no word of a criminal investigation of him. it just seems mystifying to me. >> it is strange. the really conspicuous item of news here is that this is not the s.e.c. but rat

but the cftc has the discretion to do this and it's right in the law. it's on page 328 of the conference report and if we put him there the criteria to allow them to move ahead with the swaps where we have the data and to delay it where we don't have the data. but what you're trying to do is you're going to delay the whole thing, you know, and all it's going to do is ensure that these profits and these big bonuses that they're paying on wall street can go on longer than they need to. so, you know, i don't know any reason why we need to do this. if you read this, you know, they have all the discretion, all of the problems that people brought up with the block trades and these other things that people were concerned about are in there and the last thing it says, they have to take into account whether the public disclosingure will materially reduce market liquidity. -- disclosure will materially reduce market liquidity and they're doing that. i believe -- >> will the gentleman yield? mr. peterson: fine. i'll yield. mr. garrett: so the gentleman agrees that

as you know the cftc has called for comments on proper sequencing. we may have to make some compromises as will the ei but it is not tenable for us to say our way or highway. for capital requirements we have now on the third version of the capital accord. the basel capital accord. although it is very difficult to precisely quantify the impact, the economic impact of basel iii we know it will affect gdp in only one direction, down, perhaps up to $951 billion in the u.s. alone between 2011 and 2015 according to one estimate. although basel iii is an international initiative, it has differential impact in different countries. the testimony earlier today of acting comptroller of the currency walsh and governor tarullo frankly acknowledges this problem. beyond the uniformty problem we should have learn ad big lesson with our experiences with basel 1 and basel 2. the ability of basel to determine the right amount of capital for a given risk is highly questionable. basel iii is not a silver bullet. far from it. in my view, we should use the long, full phase

another important point relates to the proposed business conduct rules, the cftc's proposals seem to ignore the institutional nature of the otc derivatives market. moreover, the standards far exceed the protections required by the statutes and will be on the regulatory framework contemplate in other jurisdictions. these rules will further impair the viability of u.s. markets. another key issue is the issue of extra territory, today there are series concerns about the reach of the dodd-frank act outside of the u.s. and into activities that take place overseas. extraterritorial region exacerbates the problem created by asymmetric rules. furthermore, it is inconsistent with congressional intent in limiting the territorial scope of the new regulatory framework for derivatives. as i mentioned there are also many differences, meaningful differences in timing between the various jurisdictions. it appears the u.s. financial markets will be subjected to a new regulatory framework will be for other jurisdictions. this will create an uneven playing field that could cause capitals to leave our s

not in dispute one only has to require, one only has to recall the testimony the head of the ft -- cftc about the dangers derivatives that were dismissed by the treasury secretary larry summers and fed chairman alan greenspan. but by the time the gramm-leach-bliley act was passed in 1999, the regulatory architecture of the 1930's was long since dead ha, killed not by is the police about the markets of disciplines, but by innovation. innovation occurred for many reasons. the end of the brentonwood system of exchange rates created the need for the currency hedging instruments and swap arrangements, high inflation rates in the 1970's inspired the development of certificates of deposits now accounts there was ongoing constant regulatory arbitrage and the shuttle banking system is the heart of miami's about the dodd-frank act. of the rooms that occurred at the onset of the financial crisis occurred in the shadow banking sector, the runs on a wholesale funding markets, money market funds a around the dodd-frank act and implementation and michael speaks of this morning is acknowledged this. bu

not in dispute one only has to require, one only has to recall the testimony the head of the ft -- cftc about the dangers derivatives that were dismissed by the treasury secretary larry summers and fed chairman alan greenspan. but by the time the gramm-leach-bliley act was passed in 1999, the regulatory architecture of the 1930's was long since dead ha, killed not by is the police about the markets of disciplines, but by innovation. innovation occurred for many reasons. the end of the brentonwood system of exchange rates created the need for the currency hedging instruments and swap arrangements, high inflation rates in the 1970's inspired the development of certificates of deposits now accounts there was ongoing constant regulatory arbitrage and the shuttle banking system is the heart of miami's about the dodd-frank act. of the rooms that occurred at the onset of the financial crisis occurred in the shadow banking sector, the runs on a wholesale funding markets, money market funds a around the dodd-frank act and implementation and michael speaks of this morning is acknowledged this. bu

cftc is involved in that review being coordinated by the justice department. this happened in 2008 as well and it became difficult to determine whether or not there was anything illegal that was going on in the marketplace or was it more the way commodity markets work. people go in and back on what price will be in the future. that is what the markets are set up to do. we will see. i am sure that there are investigations going on that are looking closely to make certain that if you don't have a legal activity happening. host: clarence in pennsylvania, program.to the caller: progra caller: we have 22 million mexicans in this country illegally. illegally. we make them legal and they have good jobs at $6 an hour so that the foreign people can take things off. and we take the bush tax cuts and do away with them for anybody that made over $150,000. host: how does that relate to the oil reserves? caller: forget about the oil reserves. host: now to charles, a democratic college in west palm beach, florida. caller: i think you all are doing an excellent job allowing t

the sec and cftc collaborate on a implementation of an act with the sec adopted rules that prohibit sending unwanted -- fcc a popping rules that prohibit sending unwanted messages without notification. but the fcc it supports consumer education in the areas of privacy and security. an online initiative that by the ftc helps consumers brought against theft and avoiding e- mail and phishing scams. just yesterday, we held a workshop with the commission on location-based wireless services and privacy issues that they raised. at this webcast event, t whichhe ftc participated, we gathered information from wireless carriers and business and academic leaders about services. industry best practices for protecting personal information. and what consumers and parents should know about protecting themselves when using these services. we heard about the many but the benefits of location-based technologies and the challenges of educating consumers in protecting privacy while using new products and services. the ftc brings expertise about technologies and services. protecting privacy is a necessary part o

that is to say there are some concern that budget constraints imposed by the congress on the sec and cftcin particular have slowed the process of implementation in dura for this reform and some concern that it will be hard to get the consumer agency off the ground when you have 44 senators who said they won't confirm somebody to run that place unless they change the law. so that is worrisome to me. but, if you look at the overall picture, both on i would say the fossil process and on fee rule-writing it has gone faster and better than i would have anticipated. >> okay last question and then we will take a break. >> dennis kelleher from better markets. this may relate more to the next panel than this one but i wanted to ask kind of a macroquestion which is you bring up the limitations of the fed under 13.3 and how it air made him impair its ability to future. that really flowed from the feds lack of information to everybody including the congress. you have to remember the sanders amendment passed 96-0 the senate. unanimity is not common in the senate and bernie sanders will never in his li

commission or train to come out of cftc with justice that is the case under current law? >> generally speaking -- >> to the good relationship that furthers the relationship to consumers at prosecuting criminals or do we need to create justice more authority than a dirty present? >> it is important to have all the tools they need to go after folks who are hacking into databases and to the extent they feel they need more tools, we obviously would support that. at the same time, it's critically important to recognize will never be able to catch criminals or hackers. what is critically important in the very built as well as it ensures that companies will shore up their data protection practices in the first instance is that they aren't affected by hacks to the extent we can have that. we appreciate your bill and incentivizing programs in place for civil penalties program. >> i've got 40 seconds left. many companies are already offering consumers the ability to use web browsers that had to backtrack mechanism. however, when consumers use this feature, no one is honoring this r

before, and you'd be right, except for the bill we are talking about today would gut money for the cftc, which will be the regulator on the derivatives markets. the majority can't say we shouldn't regulate them, but instead they're say, let's gut the regulators' ability to look after these contracts. sounds crazy, it is. thank you, mr. speaker. the speaker pro tempore: the gentleman's time has expired. for what purpose does the yom from hawaii rise? >> i ask unanimous consent to address the house for one minute and revise and extend my remarks. the speaker pro tempore: without objection, the gentlewoman is recognized for one minute. >> during these difficult times , we define ourselveses by how we treat those who are less fortunate and dependent. and how we keep our proms. this is why it's so important we keep our promises to our seniors. i'm speaking about medicare and the republican plan to do away with medicare as we know of it today. ms. hanabusa: we owe it to our seniors to be honest and up front to them as to exactly what this plan will do. you hear it will not affect those who ar

supplemental food program and emergency food assistance program, school lunches, food safety, the cftc, international food, all of these basic, commonsense solutions and think take a big hit so the majority can preserve tax breaks for the rich. to their credit, even republicans in our committee saw this $147 million handout as a bridge too far so they and democrats a like approved the transfer of these funds to w.i.c. until the republican leadership steps in and knee debated our vote. we cannot be taking food out of hungry people's at home to subsidize cotton production overseas. as mr. flake noted, it is quite ironic, we subsidize brazil and agriculture so we continue to excessively subsidize agriculture here. i urge my colleagues to abide by the vote of our subcommittee. stand up for women and children and reject this bill. this is not what we voted for and not what the american people. i yield back. the chair: the gentlelady yields back. the clerk: page 74, line 24. the chair: for what purpose does the gentleman from oklahoma rise? mr. lucas: i make a point of order against section

i do not think the cftc with the mandate to do things that put people a disadvantage.he general framework is we had a problem of unchecked leverage come a problem of not being a terrible financial crisis because we haven't an appropriate regulation. as we do the regulation, it's important to keep in mind to things you throw the financial institution is not to make money for themselves, but to be the intermediary between the various phases of capital and people who will put it to good use and they need not to allow a competition to be used simply to denigrate, but rather to get cooperation civic etiquette regulatory scheme that puts no one ever people and international disadvantage. >> thank you. the servers for one minute. >> given by the financial crisis have been covered so far off the radar this reform effort is gone. let's not forget this all started when congress decided to embark on a course of social justice to get everyone who wanted one into a home, regardless of whether or not they could afford it. then came the crisis followed by dodd-frank. let's be clear.

it's a very large cut for the cftc. there are programs that are mandatory, and so they have to be funded at a certain level certain laws say that. but the republicans have been taking a look at where they can cut because that's where they see their mandate as being. host: we have a special line set aside if you are a farmer. 202 is the area code, 737-2579, that's 202-737-2579. or guest is karen fuog of congressional quarterly. she's keeping track of the agriculture bill, now moving through the senate. some more numbers -- $71 billion for food stamps, $18 billion for childhood programs, including school lunches $14 billion in either direct or indirect aid to farmers. there's also $4 billion for the f.d.a. $2 billion per rural development program, northerly a billion dollars for food safety and inspection services, and also nearly a billion dollars for agriculture research. guest: that's true and yet democrats are saying there's a lot of cuts. they're saying the cuts, it's not enough to let them be effective in carrying o

that is to say there are some concern that budget constraints imposed by the congress on the sec and cftcin particular have slowed the process of implementation in dura for this reform and some concern that it will be hard to get the consumer agency off the ground when you have 44 senators who said they won't confirm somebody to run that place unless they change the law. so that is worrisome to me. but, if you look at the overall picture, both on i would say the fossil process and on fee rule-writing it has gone faster and better than i would have anticipated. >> okay last question and then we will take a break. >> dennis kelleher from better markets. this may relate more to the next panel than this one but i wanted to ask kind of a macroquestion which is you bring up the limitations of the fed under 13.3 and how it air made him impair its ability to future. that really flowed from the feds lack of information to everybody including the congress. you have to remember the sanders amendment passed 96-0 the senate. unanimity is not common in the senate and bernie sanders will never in his li

you mentioned cftc, the s.e.c., you mentioned the fed. is the ftc involved? >> not to my knowledge, the ftc. >> what other agencies -- >> the sythes committee. we're voluntarily filing. >> anybody else that you can identify that you're submitting information to? >> i just didn't hear you say justice department. >> well we said doj at the outset. they're the big, big enchilada here, they make the final decision. what i'm not clear on is what these other agencies, what their role is. what is, let's just go one by one. s.e.c., obviously provides expertise to the department of justice. but do they have another role with reference specifically to the new york stock exchange? are you submitting information to them and are they reviewing it? and for what purposes are they reviewing it? >> yeah. they work with the foreign regulators in europe to make sure that the division of labor and there's an m.o.u. between. for example, s.e.c. and the college of regulators, even for existing exchange. it has to do with rules for exchanging information when there are investigatio