Battle Over Regulation Looms in '09
Some worry Obama won't do enough to rein in derivatives market
By Jason Farago,  Newser Staff
Posted Dec 25, 2008 9:24 AM CST
Former Securities and Exchange Commission Chairman Arthur Levitt Jr., testifies before the Senate Banking, Housing and Urban Affairs Committee hearing on problems in credit markets, and origins of the...   (AP Photo/Manuel Balce Ceneta)
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(Newser) – After the economic meltdown of 2008, the coming year will see a battle over one of the most politically contentious issues in finance: the regulation of derivatives markets. Some who opposed government oversight before now acknowledge the need for tighter controls. But they face an uphill battle, reports Newsweek, against an Obama administration stacked with laissez-faire disciples of Alan Greenspan and Robert Rubin.

One former head of the Securities and Exchange Commission, who once opposed regulation, said recently that only beefed-up oversight can restore confidence in battered markets—and prevent another subprime-style meltdown in the future. Foreign leaders are pushing for a transformed regulatory model, but while Greenspan told Congress he viewed the crash with “shocked disbelief,” his protégés have yet to formulate a coherent response.