The chair of the European Parliament's Economic and Monetary Affairs Committee spoke at a derivatives conference in London today and, as you'd expect, anybody who is head gatekeeper for derivatives legislation in Europe added more fuel to the derivatives vilification campaign.
"They [OTC derivatives] were not a major factor in the crisis although, of course, a lot of politicians had worried they might be a cause of a crisis for quite a long time," said Sharon Bowles, whose committee is responsible for passing any new European Union rules on derivatives.
Wait a second! OTC derivatives were not a major factor in the crisis?! Maybe it's just a case of British sarcasm not coming through very well on paper. Did she not tune into the Congressional panels filled with experts who explained once and for all that derivatives do nothing but cause destruction? Ask the Oracle. He'll tell you what bespoke derivatives can do. But maybe that was just a slip up on her part. Please continue Sharon.
"Where bespoke OTC products are retained and needed then it seems there should be proper analysis to see what risk those pose rather than make a blanket assumption concerning their risk and penalize them all," she said.
In the words of Al Michaels, "Do you believe in miracles? YES!"
EU Econ Committee: Derivatives Not Big Factor In Crisis [WSJ]