CFTC Acting Chair J. Christopher Giancarlo argued for a change in priorities at the CFTC. In remarks delivered before the 11th Annual Capital Market Summit, "Financing American Business," at the U.S. Chamber of Commerce, Mr. Giancarlo asserted that "flourishing capital markets are the answer to US and global economic woes, not diminished trading and risk transfer."
Mr. Giancarlo critiqued the federal government's response to the financial crisis during the past decade. He reasoned that "[s]o much policymaking, rulemaking, and thought have been directed at building a regulatory superstructure ostensibly to prevent another 2008-style crisis that we've lost sight of the challenges just ahead of us to formulate the right regulatory response." Specifically, Mr. Giancarlo criticized "[t]he overly prescriptive regulation of American derivative markets, [which] is part and parcel of the over-regulation of the U.S. economy that thwarts revival of American prosperity." He urged the CFTC to "move forward with a better regulatory framework for swaps trading," to take "greater care and precision in rule drafting," and to utilize "more thorough econometric analysis, less contracted timeframes for public comment and a reduced docket of new rules and regulations to be absorbed by the marketplace."
Acting Chair Giancarlo also announced that Assistant U.S. Attorney of the Southern District of New York James McDonald will serve as the next CFTC Director of Enforcement. Mr. Giancarlo stated that "the appointment of Jamie McDonald as CFTC Director of Enforcement is a signal that market enforcement will remain aggressive and assertive under the Trump Administration."
Commentary / Bob Zwirb
Notwithstanding his fundamental criticism of the "overly prescriptive" and "highly over-engineered" nature of the post-crisis regulatory response, Acting Chair Giancarlo takes great pains to defend both the underlying Dodd-Frank statutory architecture crafted by Congress to address that crisis and the basic regulatory framework created by the CFTC to carry out that task. He emphasized that his aim is not to "repeal or even rewrite" CFTC rules implementing that framework, but to "take[] our existing rules as they are and apply[] them in ways that are simpler, less burdensome and less of a drag on the economy" (emphasis in original).
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