Providing For Further Consideration Of H.R. 4173, Wall Street Reform And Consumer Protection Act Of 2009

Floor Speech

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Mr. WATT. I thank the gentleman for yielding time.

Madam Speaker, obviously, I am a very strong supporter of this legislation, and I was here on into the evening last night to express my support for it; but there is one aspect of it that I want to point out that I have some discomfort with and which I would like to speak about. There is really nothing we can do about it, and it is not going to cause me to vote against the bill, but I think we need to continue to work on it.

The Financial Services' version of the bill requires swap dealers and major participants to execute their standardized swaps on exchanges, or swap execution platforms. These provisions, we thought, were very important to the bill. The reason for that is, 15 years ago, the only way to search for a swap transaction was to use the telephone. It was time-consuming, expensive, and a company was never sure that it had found the best deal.

Today, new electronic technology creates pre-trade price transparency. The House Financial Services' version required the use of that platform for transparency purposes so that companies could get the best price in an open transparent market and so that regulators could have a high-resolution view of risk as they moved through the system.

It was our intent that the regulators would require these new technologies to be used for price discovery so that impartial, instantaneous information was available to all participants at the same time. So we kind of lost the totality of that in merging the Financial Services' version of the bill and the Agriculture Committee's version of the bill. I just want to rise to put it back on the radar screen as something that we need to continue to try to resolve. When you have got a $600 trillion over-the-counter derivatives business, there needs to be absolute transparency as there is in the stock market. That is the only way you can bring this out of the shadows and onto a transparent platform.

So I hope we will be able to continue to work with it. The chairman of Financial Services has been excellent on this issue. I hope we will continue, as the House and the Senate move these bills, to figure out a way to make sure that we have the maximum amount of transparency as we did in the Financial Services' version of the bill.

I thank the gentleman for yielding me time to raise this issue.

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