Philip McBride Johnson offers a belated alternative to the convoluted CFTC definition of a swap.
When the Dodd-Frank Act was still in the drafting phase, and
was growing daily by thousands of words, I bet a friend in the
publishing business (name withheld to protect the innocent)
that I could reduce it to a single sentence. Here it is:
"All instruments known as 'swaps' are hereby declared to be
contracts for future delivery if symmetrical payments are made
between the parties based on changes in the benchmark's value,
or to be options if one party commits to an agreed payment or
action if a defined event occurs in exchange for one or more
fee or premium, and subject to the Act's existing provisions
except as may be exempted by the Commission."
This article is available to subscribers and registered users
Please log in to continue reading.
Not yet registered? Take a free trial.
If you have already taken a free trial you
have ongoing access to the analysis section of FOW.com including this story.
Log in using your details below to read.
Already have an account? |