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Regulate Otc Derivatives By Deregulating Them, Lynn A. Stout
Regulate Otc Derivatives By Deregulating Them, Lynn A. Stout
Lynn A. Stout
When credit markets froze up in the fall of 2008, many economists pronounced the crisis inexplicable and unforeseeable. Lawyers who specialize in financial regulation, and especially the small cadre who specialize in derivatives regulation, knew better.That's because the roots of the catastrophe lay not in changes in the markets, but changes in the law. In particular, the credit crisis can be traced to Congress's 2000 passage of the Commodity Futures Modernization Act, which radically altered the traditional legal approach to financial derivatives. This shift in the legal treatment of financial derivatives has brought the banking system to its knees. The …