Former Treasury Secretaries Robert Rubin, Hank Paulson and Tim Geithner are all in agreement about what is ailing the U.S. and it certainly isn’t the fiscal policies being deployed by the executive branch: It’s the dysfunction in Congress.

Appearing together on a panel at the 2015 Milken Institute Global Conference in Beverly Hills on Monday, Geithner cited the “appalling” ineffectiveness of Congress as a major obstacle to prosperity in the U.S. Paulson added that the political landscape in Washington will need to be reformed before any major progress can be made on entitlement reform. Meanwhile, Rubin blamed “the social media” for stoking some of the political dysfunction, which was an interesting take considering the panel was being moderated by Facebook COO Sheryl Sandberg.

Amid all the gloom and doom, it was Geithner’s furrowed brow and pessimism about … well … everything that became a hot topic at the conference throughout the rest of the day. (read more…)

A few highlights and memorable quotes from Day One of the 2015 Milken Institute Global Conference:

Former Treasury Secretary Robert Rubin revealed that while he was in office he once had to explain to then-Federal Reserve Chairman Alan Greenspan that Jimmy Buffett was not the son of Warren Buffett. Apparently, Greenspan had no clue the Man from Margaritaville was not kin to the Oracle of Omaha.

Yasuhide Nakayama, Japan’s State Minister for Foreign Affairs, opened his comments during the Global Risk panel by apologizing that his English was not very strong. Nakayama explained that he taught himself English by watching movies like Beverly Hills Cop 1. Sen. Lindsey Graham then wise-cracked that he could understand Nakayama far better than one of their fellow panelist: Former British Prime Minister Tony Blair.

Bombardier Executive Chairman Pierre Beaudoin on the sometimes useless exercise of trying to predict geopolitical and economic trends and events. (read more…)

The circumstances surrounding the arrest of Navinder Sarao for his actions related to the Flash Crash have been covered widely, but there is one angle that seems to be slipping through the cracks: Sarao’s intent. Or more precisely, his lack of intent.

Considering the volume of trade orders Sarao is alleged to have placed and then canceled, it seems likely his intention was to manipulate the market. And if Sarao ever stands trial and it is proven that he was “spoofing” or manipulating the market in some other way, then he should be punished accordingly.

However, I find it hard to believe Sarao woke up on the morning of May 6, 2010, and said to himself, “Today I am going to crash the market, drive shares of Accenture to one cent, raise Apple shares to more than $100,000 and then call it a day.” In fact, his actions after the Flash Crash suggest he had no idea his trades played such an allegedly large role in the day’s events. (read more…)

CME Group’s latest marketing effort focuses on the global energy, financial and agricultural markets, highlighting how the exchange group empowers customers in these industries with the capabilities to effectively manage risk and maximize opportunities.

One of CME Group’s recent successes is in the cocoa futures market. Since launching its euro-denominated cocoa contract three weeks ago, CME Group has traded more than triple what Intercontinental Exchange has transacted. Volume was 1,562 contracts, compared with 463 traded by ICE.

In the energy markets, a more traditional area where CME Group is looking to help businesses manage risk is oil prices. The exchange’s OpenMarkets news and analysis website published a piece this week that dives into how businesses could have utilized derivatives to help weather the recent plunge in oil prices.

CME Group has also added content to its microsite — cmegroup.com/advance — providing the latest insights into global market trends based on industry data. (read more…)

Just wrapped up a week in sunny San Diego covering the SIFMA Ops conference. Hours and hours of great speakers and insights. A few observations:

SEC Commissioner Kara Stein is ambitious: As covered earlier this week on this site, Stein wants to revolutionize the way data is gathered and analyzed at the SEC. She sounds a lot like Scott O’Malia did during his days at the CFTC. O’Malia didn’t bring the CFTC up to speed before he left for ISDA. Given the budgetary and political landscape, the odds seem long that Stein will have any better luck at the SEC before she departs for her next gig.

If Richard Berner shouted in a forest and no one was around, would he make a sound?: Berner and the team at the Office of Financial Research are doing tremendous work. They produce great research and analysis, but I am just not sure how many people are reading it. (read more…)