This video can be viewed at the below link.[1]

What is the Securities and Exchange Commission’s Division of Trading and Markets, and what does it have to do with an hourglass?

I’m Gary Gensler. Welcome back to Office Hour…glass.

Finance is about the pricing and allocation of money and risk throughout the economy. There are those who have money who want to invest it. Others need money to fund good ideas, buy a house, or help get through life’s inevitable challenges. There are those who have risk but don’t want to bear it, and others willing to take on that risk.

Finance sits in the middle, like the neck of an hourglass whose grains of sand are money and risk.

In the midst of the great depression, Franklin Roosevelt and Congress understood that what happens at the neck of the hourglass is very important. They set up the SEC to oversee those markets—and the intermediaries at the neck of the hourglass—to promote fair, orderly, and efficient markets.

They wanted markets to serve investors and issuers alike, rather than the other way around, where investors and issuers might serve the intermediaries in the middle.

Thus, in 1934, Congress enacted laws to set up the SEC to oversee the neck of the hourglass, with a mission that includes maintaining fair, orderly, and efficient markets.

Our Division of Trading and Markets oversees those intermediaries—those gatekeepers, one might say, in the middle.

The Division oversees the exchanges themselves, like the stock exchanges or alternative trading systems.

The brokers that handle your orders and are required to safeguard investors’ assets entrusted with them.

The dealers that make markets or transact in the markets.

The clearinghouses and transfer agents that deal with the market plumbing.

And the self-regulatory organizations associated with those intermediaries, which I might mention file as many 2,000 rule changes every year that need to be reviewed on your behalf by our staff.

The Division makes sure that the intermediaries follow our rules—or implement their own rulebooks, when applicable—to prevent fraud, manipulation, conflicts, and inappropriate commingling of funds, all while making required disclosures.

The Division also makes recommendations to our five-member Commission to update our rules of the road, given rapidly evolving technology and business models.

Altogether, the remarkable 270 staff plays an important role to oversee the hourglass: every day, and every hour.