Bloomberg News

Geithner Says Derivatives Markets ‘Substantial Source of Risk’

February 14, 2012

Feb. 14 (Bloomberg) -- U.S. Treasury Secretary Timothy F. Geithner said today that “the derivatives markets are still a substantial source of risk even with all the benefits they bring to peoples’ capacity to hedge risks.”

“Because we have forced U.S. financial institutions to hold much more capital against those risks -- not just in derivatives but more generally -- we think the American financial system is in a much better position to withstand not just the pressures we’ve seen in Europe so far but could see from other shocks down the road,” Geithner said during testimony before the Senate Finance Commmittee.

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