The International Swaps and Derivatives Association, Inc. (ISDA) today made the following comment on SEC Chairman Christopher Cox’s testimony to the Senate Banking Committee:
"During the current market volatility the credit derivatives market has performed very well. It has allowed companies and investors to manage their risks in a time of higher than usual rates of default, and the credit events that have occurred thus far are being settled in an orderly fashion. Credit derivatives market participants are the first to encourage the SEC to use its authority to ensure attempted manipulation of these markets is punished. However proposals which would seek to treat privately negotiated contracts as securities, or otherwise apply ill-fitting regulatory regimes to these agreements, are likely to deter healthy economic activity and push derivatives into markets where the SEC has no jurisdiction," said Robert Pickel, executive director and ceo, ISDA.
