SEC Chair and Billionaire Clash Over Proposed Reforms to Treasury Market
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SEC Chair Gary Gensler is butting heads with billionaire Ken Griffin over proposed reforms to the multi-trillion dollar Treasury market.
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At issue is the Treasury basis trade, a highly profitable strategy used by hedge funds that could cause liquidity issues.
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Gensler wants more oversight of hedge funds trading Treasuries, but Griffin argues it will raise costs.
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Regulators worry the basis trade's size and leverage could trigger instability during stresses.
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Beyond Gensler, groups like the BIS also want to improve Treasury market resilience after stresses in March 2020.