Part Two of Scott Early – The History of Financial Futures

John Lothian

John Lothian

Executive Chairman and CEO

Part two of the JLN interview with former CBOT General Counsel Scott Early in The History of Financial Futures series starts with him explaining why the Chicago Board of Trade’s market share went down each year he worked at the exchange. It  was because new exchanges all over the world were copying the success of the CBOT and CME and that was growing the overall derivatives markets numbers. 

And as the futures volume grew in the U.S., Congress took note and discovered a potential new source of tax revenue, which caused a change in tax laws. 

New fringe players came into the markets with contracts that skirted the laws of what was allowed, something that played out all the way to the passage of Dodd-Frank, Early said.

The CBOT was well positioned for the creation of the stock index futures, as Phil Johnson, the then-head of the CFTC, had once been the outside counsel of the CBOT.  And cash settlement was just another chapter in a long debate that continues to today about what is a futures contract, Early said.

The reduction in number of FCMs in the industry is another subject Early speaks about. 

Early weighs in on why the CBOT and CME have never wanted to be under the jurisdiction of the U.S. Securities and Exchange Commission. He also talks about the relationship between the CBOT and the CBOE and how it evolved over time. A new younger generation of options traders at the CBOE without a historical appreciation for the CBOT impacted the relationship, Early said.

The curious case of rising stocks in the night-time

The curious case of rising stocks in the night-time

First Read Hits & Takes John Lothian & JLN Staff Congratulations to uber journalist Jacob Bunge on being promoted to the role of Chicago deputy bureau chief for The Wall Street Journal. Bunge has been with the Journal since 2008, when he came over from...

We visit more than 100 financial news websites daily (Would YOU do that?)

The Spread

Stock Market Selloff Worries Investors & Regulators; Adam Dell Launches Domain Money; ​​CME Group Announces Records

Alex Perry Author John Lothian News ALEX PERRY’S OPTIONSTOPIA: Alex Perry’s Optionstopia” takes a look at this week’s options news highlights: Regulators Crack Down on Trading apps; Adam Dell Launches Domain Money; The ​​CME Group Announces New Options Records

John Lothian Publisher John Lothian News JOHN’S TAKE: John talks with Henry Schwartz, president of Trade Alert LLC, for “John’s Take”

Tom Jarck Term of the week John Lothian News TERM OF THE WEEK: What is The VIX Index Anyway? with Russell Rhoads

read more

Todays  Options Newsletter

Now Read This

The History Behind SGX; An Interview with Rama Pillai for The History of Financial Futures – a JLN Interview Series

The History Behind SGX; An Interview with Rama Pillai for The History of Financial Futures – a JLN Interview Series

In 1978, the Gold Exchange of Singapore (GES) was created by some Singaporean bullion dealers. Then in the early 1980s, the Monetary Authority of Singapore and financial community leaders sent teams around the world to examine different market structures. One was sent to Chiago to examine the Chicago Mercantile Exchange, Pillai said. The Singaporean team sent to Chicago liked the CME model and felt it would work well in Singapore. This led to the creation of the Singapore International Monetary Exchange or SIMEX.

Calvin F. Williams Jr is Using His Business to Close the Wealth Gap

Calvin F. Williams Jr is Using His Business to Close the Wealth Gap

From creating investment management strategies to expanding financial education, Calvin F. Williams Jr. runs his business with one clear goal in mind: to close the racial wealth gap. Since age 12 when he first started his own lawn care service, he understood the value of building wealth, yet he also understood that many people lack the financial resources to do that. 

Pin It on Pinterest

Share This Story