P.M. BRIEFING : Brady Targets Futures Panel
Treasury Secretary Nicholas F. Brady today proposed ending a bitter two-year turf battle over regulating a new breed of equities products by stripping the Commodity Futures Trading Commission of some or all of its power.
“What’s important is that we get something done and get it done now,” said Brady in a speech before the National Newspaper Assn.
His comments added sudden urgency to an issue that until now the Bush Administration has handled with great delicacy.
Brady’s outspokenness will likely propel legislation, viewed as wishful thinking several weeks ago, to hand the Securities and Exchange Commission control of all financial instruments based on stocks, congressional aides said.
The CFTC claims jurisdiction over any instruments that are like futures contracts.
A federal court in Chicago has given control of new stock index baskets to the CFTC. The baskets resemble both stocks and futures contracts.
The CFTC already controls all futures contracts linked to stocks, which means the SEC has no authority over financial instruments that can cause wild swings in the stock markets it regulates.
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