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Commissioner Bart Chilton said the commission could have achieved greater transparency by approving the original proposal. But he said a compromise was better than no action. "By failing to act, we leave in place unregulated dark markets. These are the very dark markets that got us into the economic mess in 2008," Chilton said. Wall Street banks had opposed requiring a minimum number of bids for derivatives contracts. An official for the Securities Industry and Financial Markets Association, Wall Street's largest lobbying organization, says the rule could ultimately hurt the everyday investor that it seeks to protect. Kenneth E. Bentsen, Jr., acting president and CEO for SIFMA, contends that more bids could chase financial firms out of the trading exchanges. That's because some might fear confidential price information could be widely broadcast. Fewer firms could lead to less liquidity in the market. That would slow trading. Under the rule, however, the bids would not be made public. The lower requirement illustrates how banks have managed to tweak rules written by Congress three years ago that are still being finalized by regulators. The banks have also succeeded in weakening a rule that would ban banks from trading for their own profit. The latest version of the so-called Volcker Rule includes an exemption for banks to make such trades when they are used to offset others risks taken. The rule was named after former Federal Reserve Chairman Paul Volcker. Its adoption has been delayed largely because of the banks' objections.
[Associated
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