With Gary Gensler’s time as Chairman of the US Commodity Futures Trading Commission coming to a close after five years of leadership, new unidentified sources in Washington have re-stirred the speculation pot, hunting for his successor.
Currently, media reports have suggested a small flock of potential leaders of a commission with a far larger footprint and regulatory responsibility than when Gensler started. The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 which Gensler implemented gave new powers to the regulator now responsible for both the futures and multi-trillion dollar swaps markets.
The most recent name to emerge is Treasury Department official Timothy Massad, who has overseen the ending of the government’s bank-bailout program. He could be a smart, safe pick. He was confirmed to his role by the Senate in 2011, making his resume seem noncontroversial.
President Obama recently had his nominee for FERC chairman, Ron Binz, shot down by the Senate earlier this month and would likely want to avoid another setback.
Other names that unidentified sources have floated include former CFTC enforcement chief Geoffrey Aronow and New York Law School professor Ronald Filler, who chairs the CFTC’s Global Markets Advisory Committee.
Commissioner Mark Wetjen’s name has also been noted at a potential interim chairman while the next chair goes through the confirmation process.
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The reason the media is likely grasping at straws and the White House is silent is because finding a successor to an agency like the CFTC isn’t easy. The next leader has the tough task of not only being an expert on the swaps and futures market, but must be adept at articulating the most complex policies and rules in Washington.
You can imagine the conversation at the White House, “Who can we pick that Wall Street respects, understands swaps regulations, can talk about it to media, yet can champion the concerns of grain elevator operators and farmers while focusing on commodity market manipulation?”
A hard cocktail to find pre-mixed.
Amanda Renteria, a Senate staffer and early favorite found that out the hard way. After being anointed as CFTC chair by some media outlets in June, her star faded quickly. Media reports said she had “little experience in financial regulation.”
It shouldn’t be overlooked how successful Gensler was at walking the tightrope. His background at Goldman Sachs and the Treasury department proved invaluable as he could stand toe-to-toe with both the media and Wall Street heavyweights.
While Gensler’s leaves big shoes to fill the next chapter at the agency will be one of rule enforcement, not rulemaking, so expect a different look and feel to the CFTC in 2014.