House eases restrictions on derivatives trades
Dec 10 10:41 PM US/Eastern
By JIM KUHNHENN
Associated Press Writer
The legislation imposes new regulations on derivatives, aiming to prevent manipulation in and bring transparency to a $600 trillion global market. But an amendment by New York Democrat Scott Murphy, adopted 304-124 Thursday night, exempted businesses that trade in derivatives, not as financial speculators, but to hedge against market fluctuations such as currency rates or gasoline prices. The amendment also provided an exception for businesses that are not considered too big to be a risk to the financial system.
Relatively small businesses, like the monolines, can endanger the financial system by gambling on credit default swaps.
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