The Cat’s Out of the Bag
What, haven’t heard about that report? Well, that’s the main point of the story. The report was spiked by the GFMA, a banking trade association, which commissioned it. According to Javier:
However, the report was never completed and remained in a “draft” status, after its conclusions went against the interest of the lobby group, three people familiar with the matter said.
So yes, perhaps you’ve guessed by now that the academic in question is me (though you have to read 2/3s of the way through the story to get to my name). And yes, that’s pretty much what I understood to have happened, though I was never told that in so many words. It’s nice to have it confirmed by “three people familiar with the matter”, even though it was blindingly obvious to me at the time. *
I call them like I see them. GFMA didn’t like that. I wouldn’t change the call, so they sat on the report. So it goes.
I think GFMA handled this badly even from the perspective of its own interests, though I guess I am not really surprised: this is the way organizations like this tend to behave. I am sure this has given the report more visibility than it ever would have achieved otherwise, and makes GFMA look bad in the bargain, at least in my (probably biased) opinion. The regulatory body they were trying to influence-the FSB-was briefed on the findings, and had a draft of the report, so deep-sixing the report only signaled to the FSB that GFMA didn’t like the results, which it probably knew anyways. Spiking the report also serves to validate the independence of the findings-and of the finder of the findings. That’s definitely an upside for me.
Working on the report helped me learn a good deal more about the global commodity trading firms, so that’s also a good thing. I look forward to learning and writing more in the future.
*For the record, the copy of the report “seen by the Financial Times” didn’t come from me.
Hope you at least got paid, Prof.
Comment by markets.aurelius — May 13, 2013 @ 9:24 am
and that they didn’t shoot the messenger. How typical to use regs to stifle competition. Congrats on honesty – no Enronite (Krugman) you!
Comment by Sotos — May 13, 2013 @ 12:19 pm
@markets.aurelius . . . yes, took their money & wrote what I believed.
@sotos. Not dead yet. Very typical . . . and thank you.
Some Russian advice to American media under Obama Stasi regime: n I e baltai po telefon e t a nahodk a Bely Dom sp ion av.
Still live in the Land of the Free Professor?
Comment by Narodniivan — May 14, 2013 @ 3:08 am
In USSA Bloomberg terminal watches YOU! Sorry for typos above
Comment by Narodnik — May 14, 2013 @ 3:10 am
Unfavourable report spiked by the GFMA? Shouldn’t be too surprised – look at the pair that run it: a creator of financial weapons of mass destruction and a former spin doctor for Gordon Brown and those well-known taxpayers, Vodafone.
Comment by Redlight — May 14, 2013 @ 6:34 am
Professor:
The former CCCP was more like 1984. Obama’s USA is more like Brave New World. Much more subtle. Only 50% suffers. 50% of voters. 50% of taxpayers. And 50% of the press. …. for now.
You owe the former Soviet Union an apology. They never got away w/ what Obama has gotten away with. W/ the exception of the Kursk maybe.
Expect an IRS audit of your website soon.
Vlad
PS And keep up the good work!
Comment by Vlad — May 14, 2013 @ 10:05 am
SWP, can you comment on two articles from today. first one in the FT; the CFTC is investigating energy trading firms on using EFSs, or exchange for swaps. Please illuminate us on the swap/future landscape, and how the boundary will be defined when they are economically the same thing. Second article in the WSJ on raiding energy firms for fixing prices. Officials walked in unannounced and collected trading records. Both articles are about the bad guys at energy firms disrupting the price discovery process for Bart chilton’s dog.
Comment by scott — May 14, 2013 @ 12:08 pm
@scott . . . was just about to write about the EFSs. Honest truth. Will try to get to the Platts issue too. I was just interviewed about that by Reuters.
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