Statement of Congressman John D. Dingell
On Long-Term Capital Management
September 24, 1998
When the debris from the difficulties of Long-Term Capital Management is cleared, and
we have assessed the breadth and depth of any harm to investors and markets, we will be left
with some important policy questions. Is it wise to try to cage the Financial Accounting
Standards Board and the Securities and Exchange Commission as they try to improve the
disclosure and accounting of derivatives so that markets, regulators and investors can properly
assess and digest the risks? Is it prudent to hamstring regulators such as the Commodity Futures
Trading Commission from obtaining and acting on information about these products?
The complex web of relationships between hedge funds and counter parties such as
banks, insurance companies, investment firms and others, and the time it will take to assess the
nature and extent of damages from this episode, underlines the importance of maintaining high
standards in any legislation to restructure the financial services industry.
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(Contact: Dennis Fitzgibbons 202/225-3641)
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