Examining Legislative Improvements to Title VII of the Dodd-frank Act
Examining Legislative Improvements to Title VII of the Dodd-frank Act

Author: United States. Congress

Publisher: Createspace Independent Publishing Platform

Published: 2017-10-03

Total Pages: 132

ISBN-13: 9781977882806

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Examining legislative improvements to Title VII of the Dodd-Frank Act : hearing before the Committee on Agriculture, House of Representatives, One Hundred Thirteenth Congress, first session, March 14, 2013.

The Dodd-Frank Wall Street Reform and Consumer Protection Act
The Dodd-Frank Wall Street Reform and Consumer Protection Act

Author: Mark Jickling

Publisher:

Published: 2010

Total Pages: 15

ISBN-13:

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The Dodd-Frank Act (P.L. 111-203) sought to remake the OTC market in the image of the regulated futures exchanges. Crucial reforms include a requirement that swap contracts be cleared through a central counterparty regulated by one or more federal agencies. Clearinghouses require traders to put down cash (called initial margin) at the time they open a contract to cover potential losses, and require subsequent deposits (called maintenance margin) to cover actual losses to the position. The intended effect of margin requirements is to eliminate the possibility that any firm can build up an uncapitalized exposure so large that default would have systemic consequences. The size of a cleared position is limited by the firm's ability to post capital to cover its losses. That capital protects its trading partners and the system as a whole. This report describes some of the new requirements placed on the derivatives market by the Dodd-Frank Act.