swaps

The federal insurance exchange for consumers to shop for health-care insurance policies might be extremely problematic but an exchange for financial instruments started off well, according to The Washington Post's Q&A with  the chairman of the Commodity Futures Trading Commision. Derivatives now must be traded on the exchange.

Chairman Gary Gensler explained: "'A swap execution facility is where buyers and sellers of a special derivative called a swap can meet to enter into contracts. Think of an exchange, like the New York Stock Exchange for stocks or exchanges for futures. These kinds of exchanges have been regulated by the federal government since the 1930s. But swap execution facilities had not been under any oversight. [As part of Dodd-Frank,] Congress decided to repeal these exemptions, with the public benefiting from greater transparency in these markets."'