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Senate Proceeding on May 12th, 2010 :: 7:21:15 to 7:31:05
Total video length: 10 hours 56 minutes Stream Tools: Stream Overview | Edit Time

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Richard Shelby

7:20:54 to 7:21:15( Edit History Discussion )

Richard Shelby: this is why the national association of manufacturers has indicated that all votes related to the chambliss-shelby substitute amendment, including procedural motions, may be considered for designation as key manufacturing votes in this congress. i think it's important to american business that we adopt

Maria Cantwell

7:21:15 to 7:31:05( Edit History Discussion )
Speech By: Maria Cantwell

Maria Cantwell

7:21:16 to 7:21:38( Edit History Discussion )

Maria Cantwell: this substitute. ms. cantwell: mr. president? the presiding officer: the senator washington. ms. cantwell: mr. pr rise to speak in opposition to the chambliss substitute amendment colleagues to think about this substitute in a pretty significant way, because it dramatically changes the underlying bill.

Maria Cantwell

7:21:39 to 7:21:59( Edit History Discussion )

Maria Cantwell: in fact, i almost want to ask my colleagues on the other side of the aisle if they are serious, if they're serioushat this is the proposal that they are going to put before us in response to the catastrophe tt we have seen on wall street. i know we've been on the floor and wheef a lot of history with this, starting in 2001, and i

Maria Cantwell

7:22:00 to 7:22:20( Edit History Discussion )

Maria Cantwell: remember -- i thinkt must have been 20002 oar 2003 when we tried to regulate derivatives then after the enronrisis and one of my colleagues on other side of the aisle literally said, we can't regulate derivatives. we don't know enough about them. and so what lessons have we learned since this catastrophe?

Maria Cantwell

7:22:21 to 7:22:42( Edit History Discussion )

Maria Cantwell: well, i can tell you this: we were wrong to say that we can't understand derivatives, because our lack of misunderstanding or not paying attention has led us to the catastrophe that we're in today. and for the other side of the aisle to say, we can't eve propose exchange trading, that's

Maria Cantwell

7:22:43 to 7:23:03( Edit History Discussion )

Maria Cantwell: like saying the stock market should make changes in options and stock without being on an exchange. that would that would be like the president and i swapping back and forth microsoft or starbucks stock and selling it to other people and having none of the trades, basically being reported. now, why would we tolerate that

Maria Cantwell

7:23:04 to 7:23:25( Edit History Discussion )

Maria Cantwell: for the stock market and yet we're saying, somehow it's okay for derivatives, this product that has become this unbelievable $600 trillion market, to operate in the dark? and the other side doesn't even want to have exchange trading? i just -- i -- i'm -- i can't believehat. i can't believe that somebody would even propose that.

Maria Cantwell

7:23:26 to 7:23:47( Edit History Discussion )

Maria Cantwell: now, i know some people are going to say that they have clearing. but the clearing requirements of this legislation only cover 60% of -- would leave 60% of the market uncovered, so we're talking about not having the product on exchange and not having a lot of it cleared. so the two primary principles of learning the mistakes of the

Maria Cantwell

7:23:48 to 7:24:08( Edit History Discussion )

Maria Cantwell: last 10 years are basically going unnoticed, unaccounted for on the other side of the aisle. but let's go back to how we got in this situation because we used to have a thraw basically said, yes, let's protect consumers. and we had transparency in trades. that was reporting to the cftc.

Maria Cantwell

7:24:09 to 7:24:30( Edit History Discussion )

Maria Cantwell: we had on the books capital requirements. we had speculation limits, we had antifraud and antimanipulation laws. we had trader licensing and registration. and public exchange tding. so, yes, we actually had it right. we had it right. we had some tools in place. we had an oversight agency that was supposed to do this job.

Maria Cantwell

7:24:31 to 7:24:52( Edit History Discussion )

Maria Cantwell: all of these things that protected the investments of millions of people and made the functionality of people who legitimately had to hedge -- like farmers or airline industries -- rules of the road so they weren't taken to the cleaners or the price wasn't artificially driven through the roof. buwhat happened to these things? well, what happened to these

Maria Cantwell

7:24:53 to 7:25:15( Edit History Discussion )

Maria Cantwell: things is in 2000 somebody came out here on the senate floor and basically 7:30 on a friday night stuck into an over 2,000-page bill a little exemption that said, don't regulate these derivatives. what happened in the marketplace is that derivatives were really a very small business, only a few hundred billion dollars, as

Maria Cantwell

7:25:16 to 7:25:36( Edit History Discussion )

Maria Cantwell: you can see in 1999. it was kind of an uninteresting little manchet but we ended up deregulating them and since then in this short period of time it turned into a $700 trillion manchet how do you go from that period of time to thdz 700 trillion? you go because we made it a dark

Maria Cantwell

7:25:37 to 7:25:57( Edit History Discussion )

Maria Cantwell: market. we basically said you don't have to have the rules of the road or the regulation or the oversight sore the basic things that make this a functioning market. and so what well, we had no transparency, in a requirements to keep records. that means you didn't have to be

Maria Cantwell

7:25:58 to 7:26:18( Edit History Discussion )

Maria Cantwell: able to prove to the cftc exactly what you were doing in the market. that way you couldn't actually prove fraud because you didn't know what anybody was doing because nobody had to keep records. it's like bernie madoff on steroids. we had no large trader reporting on the one hand no speculation limits. the reason you have things on an

Maria Cantwell

7:26:19 to 7:26:39( Edit History Discussion )

Maria Cantwell: exchange is because when an exchange sees that somebody is making the market or too large of a position, and oftentimes across several exchanges, you have a regulator who can dmom and say, you know what? we have speculation limits and you can't do that much trade ago because you were driving the market. so after that, we had no speculation limits.

Maria Cantwell

7:26:40 to 7:27:01( Edit History Discussion )

Maria Cantwell: we had no capital requirements. and we had this high risk of manipulation and excessive speculation. so, that's what we did. and a lot of people thought, well, you know what? i wasn't here, but i know a lot of people said, you know, this is going to revolutionize things, derivatives are going to be the wave of the future, it's going to help news our financial markets and the amount of liquidity.

Maria Cantwell

7:27:02 to 7:27:22( Edit History Discussion )

Maria Cantwell: everything is going to be great. some people said, don't worry about this. don't worry about this because they aren't going to be a very big resource, and they're going to be very small. it's only gb to be a few people that are going to trade back and forth. don't worry about it. well, just shoid the chart. it turned into ads 700 trillion industry.

Maria Cantwell

7:27:23 to 7:27:43( Edit History Discussion )

Maria Cantwell: and it was big a big opportunity for people to make a lot of money without the oversight. so now where are we today? have we learned the lessons of this catastrophe? have we? it's not to say that it isn't

Maria Cantwell

7:27:44 to 7:28:05( Edit History Discussion )

Maria Cantwell: hard to be ahead of the smartest guys on wall street. i will say, mr. president, it's very hard. that's why you have to have bright lines, because otherwise people do come up with new tools -- i saw it with enron in my state; i've seen in now with derivatives; there'll be something else. and unless we have rules of the road, then there will be people who will try to continue to have

Maria Cantwell

7:28:06 to 7:28:26( Edit History Discussion )

Maria Cantwell: opaque markets and drive tring. but our underlying proposal by the chair of the agriculture committee and this underlying bill working with the chair of the banking committee has the rules of the road. the other side of the aisle is proposing a substitute that would take those away. this is clear.

Maria Cantwell

7:28:27 to 7:28:47( Edit History Discussion )

Maria Cantwell: if you have unregulated trading, none of these things happen. if you have exchange trading, this is what the american public gets protected with: transparent pricing, real-time trade monitoring, transparent valuation, speculation limits, and puic transparency.

Maria Cantwell

7:28:48 to 7:29:09( Edit History Discussion )

Maria Cantwell: that's what this underlying bill does and that's what the amendment is trying to get rid of. they want this to be blank over here. they want this to be blank. they don't want those things to have to be met. now, how could you possibly propose that after what we just went through? you had prior to 2000

Maria Cantwell

7:29:10 to 7:29:30( Edit History Discussion )

Maria Cantwell: regulation, things were working fine. you have afterwards a major catastrophe, and these are fundamentals that we have behind all of our markets and exchange trading. so why would you let one thing off the hook? i'll never forget the day that one of the former cftc staff came and testifiedefore the energy committee and said to our committee, do you know that

Maria Cantwell

7:29:31 to 7:29:53( Edit History Discussion )

Maria Cantwell: hamburger in america has more regulation on it than energy futures? and i thought, he couldn't be serious. but he was right. futures of beef have reporting requirements, had to have transparency and real-time monitoring, have speculation limits, but these energy derivatives, because they were

Maria Cantwell

7:29:54 to 7:30:15( Edit History Discussion )

Maria Cantwell: exempted by this 200 act, didn't. so somehow we were saying that hamburger in america and making sure it played by the rules was more important than whether oil or electricity or these other things, as we know c.d.o.'s, played by the same rules. so make no mistake, this underlying bill gives us this

Maria Cantwell

7:30:16 to 7:30:37( Edit History Discussion )

Maria Cantwell: kind of predictability and certainty in the tried and true ways that markets function: with transparency. we're talking about old-fashioned capitalism here. we're not talking about oligarchies where people hide behind things. o knows what's going to happen with the fat finger the other day and what moved the market. but i know this: if you come

Maria Cantwell

7:30:38 to 7:30:58( Edit History Discussion )

Maria Cantwell: back to capital trades with transparency and pricing and realtime marketing and those speculation limits, their legislation on the other side does nothing to make sure that we prohibit the excessive speculation that can move the market in a manipulative way. mr. president, i hope that we do not adopt this substitute

Maria Cantwell

7:30:59 to 7:31:05( Edit History Discussion )

Maria Cantwell: amendment. let's show america we are serious about the kind of

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