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Strategies & Market Trends : Zeev's Turnips - No Politics -- Ignore unavailable to you. Want to Upgrade?

To: Vijay Raghavan who wrote (30761)	2/18/2002 1:42:01 PM
From: James Calladine	Read Replies (1) \| Respond to of 99280

FROM ANOTHER THREAD February 18: Enron - Congress Revisits Derivatives Trading Location: Washington, D.C. Author: RiskCenter Staff Date: Monday, February 18, 2002 Congress has started to zero in on derivatives trading as it continued to investigate the issues raised by the Enron collapse. After initially digging into Enron's off-balance-sheet partnerships and the company's questionable financing and accounting schemes, lawmakers in both houses began focusing on federal oversight of the energy trading business. Some legislators pointed the finger at Enron's huge role, through its EnronOnline trading platform, in the over-the-counter market for power forwards, saying the bankruptcy points to the need for more federal oversight. Such increased regulation is the focus of legislation introduced Thursday by a group of senators from Western states, who want to further regulate wholesale energy trading by subjecting derivatives deals, including over-the-counter forward power deals and online trading of those contracts, to more federal scrutiny. The proposal would "make sure all energy transactions are transparent and subject to some regulatory oversight," Dianne Feinstein (D-Calif.), one of the bill's sponsors, said. Feinstein said she, along with co-sponsors Maria Cantwell (D-Wash.) and Ron Wyden (D-Ore.), are seeking to "reinstate regulatory oversight to the marketplace and help ensure there is not a repeat of the energy crisis that had such a devastating impact on "California and the West." The derivatives legislation may be added as an amendment to a comprehensive energy bill that was set to be introduced on the Senate floor late last week, Feinstein said. But, she added, she did not want derivatives legislation to be torpedoed if the comprehensive bill failed. Last year's huge run-up in Western wholesale prices figured prominently in the senators' statements on the need for such legislation. They said Enron, because of the opacity of derivatives and over-the-counter markets in which it traded, may have been able to drive up wholesale prices in the West, and the Federal Energy Regulatory Commission said it would begin a formal probe into those allegations.