Stock Market JackPot System

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The New York Times reported last Friday how Citigroup actively participated in the drafting and writing of a Bill. The Bill focuses on rewriting a part of the Dodd-Frank regulations which were passed after the 2008 recession. The lobby group under contract to Citigroup drafted the Bill in which Stock Market JackPot 70 lines of the 85 line Bill which was finally passed, was written by the group. Citigroup received more help than other financial institutions after the 2008 bailout and has since taken a back seat in such issues. This is why their involvement in this Bill came as a surprise.

The specific section of the Dodd-Frank Act being aimed at in the new Bill deals with derivatives and how financial bodies hedge against their speculative risk. Derivatives are one of the most profitable instruments for institutional investment firms and banks. One of the most common traded derivatives is interest rate swaps and even this has higher profit attached to it than other frequently traded instruments. http://binaryoptionprofits.co/stock-market-jackpot-review/

After the 2008 crash, the risk of trading derivatives was highlighted and extra caution was put in place to regulate trading. American International Group placed large amounts of hedged funds into mortgages, which finally, was lost until the bailout. The Dodd-Frank Act removed this type of future risk. The majority of banks place their derivative trades inside subsidiaries. These subsidiaries Stock Market JackPot Review receive taxpayer backing indirectly via deposit insurance or emergency lending from the Federal Reserve. If bank customers dealt with subsidiaries which did not have Government support, they would be able to negotiate better rates which in turn would be less profit for the banks.

Without the Dodd-Frank Bill in the current climate, banks are looking to sink back into their pre 2008 patterns in order to maintain their high, but very risky, profits. The bill would permit some types of derivatives which are penned to be pushed-out, to remain inside taxpayer-supported entities. For instance, derivatives for betting on stocks and commodities would get to remain in the safety net. This would also have a knock on affect for regulated Binary Options Brokers.

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The push-out rule, say those in favor of the House Bill, could move derivatives trading into unregulated entities. It would also make it more difficult for the Federal Reserve to support the financial system during a crisis and in effect, turn back the system to pre 2008. With approximately $3 trillion of exposure in the derivatives market, Citigroup is one of the largest swap dealers in the US. Almost $2 trillion of these swaps are based on companies or other entities with a junk credit rating.