The Commodity Futures Trading Commission is responsible for regulating the the nation’s largest banks, including Goldman Sachs and J.P. Morgan Chase. However it may not be able to function properly in the near future. The commission is intended to have five members, but by next year, it could be down to only two, one Republican and one Democrat. This could seriously delay Dodd-Frank regulatory actions.
The 2010 act gave the commission the power to regulate over $633 trillion worth of yearly trades. But if the diminished, two-person committee gets stuck in gridlock, it will essentially be irrelevant. The committee is already down one member, who stepped down in June 2013. Another member has announced that he’ll be stepping down this year and the commissioner’s term is up at the end of 2013.
According to Bloomberg, President Obama has candidates in mind for the vacant spots, but the likelihood that the Senate could approve his appointments by the end of the year is slim at best. Among the candidates being considered by the President are a Treasury Department official, a securities lawyer and an executive at an inter-dealer brokerage firm. But since the Senate has its Thanksgiving recess pending and could face filibusters if Senators do not approve of the appointees, forward motion is unlikely.
The remaining committee members will likely be at odds on many issues and are tasked with rewriting certain trading regulations in the coming year.
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