Markey: Shutdown Taking Wall Street Cops Off the Beat as Market Meltdown Looms
Labor Dept. jobs report delay also means Federal Reserve flying blind on national economic policy
WASHINGTON (October 4, 2013) - Senator Edward J. Markey (DMass.) today expressed deep concern that the Tea Party Republican shutdown of the government will take the people who monitor and enforce financial markets off of the job, just as the markets reach an increasing point of volatility due to the impending debt default. Due to the shutdown, the Commodity Futures Trading Commission, which has jurisdiction over futures, options, and the vast majority of the derivatives market, is being forced to "largely cease" the functions of its enforcement division. Additionally, the CFTC's market oversight and surveillance operations are also expected to stop. As a result, the futures exchanges themselves will become the main monitor of our futures and swaps markets for the duration of the shutdown.
"Without the CFTC, our Sheriff on Wall Street, on the beat, the Tea Party Republicans are getting their wish: Wall Street will be left to monitor itself at a time of market volatility," said Senator Markey. "We need to end this shutdown and avoid a market meltdown from defaulting on our debt, so the federal government can get up and running. The CFTC serves as the financial 'cop on the beat' for our nation's futures and derivatives markets, and they need to be able to can get back to work so our markets can function safely to meet the needs of business and our economy."
Additionally, today the Department of Labor's Bureau of Labor Statistics would normally release its monthly jobs report, with information about how many jobs the country added in September, how much average hourly wages changed last month, and the unemployment rate last month. Yet, this report will not be released as long as we are shutdown, along with a host of other reports; the data that comprises these reports will not even be collected. This means that even the Federal Reserve will not be able to know the state of our economy, and at a time when it is the midst of significant asset purchases to help boost the economy.
"The Federal Reserve is the pilot of our national economy, and by depriving it of key economic data through this GOP shutdown, we are blindfolding the Fed and asking it to continue to steer in stormy skies," said Senator Markey. "These games have to stop. The Tea Party Republicans need to vote on a clean continuing resolution to fund the government and a clean debt ceiling increase before we put this country in even more dire straits than it was in in September 2008."