Millions in political lobbying have paid off yet again for the too big to bail and jail banking sector. Meanwhile the derivatives market (now estimated at $693 trillion!) continues to balloon in size and threat to tax payers and the real economy.
“In a victory for banks, global financial regulators backed away from earlier guidelines that the firms had warned would destabilize the $693 trillion derivatives market.
The Basel Committee on Banking Supervision’s final rule, released today, will require banks that broker swaps trades to set aside much less money to protect against a default versus a proposal published last year. The plan now applies a minimum 20 percent risk weighting to money deposited at clearinghouses, which are third-party guarantors that back the transactions, down from 1,250 percent in the original proposal. The change takes effect on Jan. 1, 2017”.
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