Mar. 23, 2023
March 23, 2023
Dear SEC regulators,
I support the headline and goal of S7-01-23, as I believe the ABS market is headed for great turmoil in the wake of risky auto financing.
However, the issue is immediately apparent in the exceptions made for: hedging, liquidity, and marketing making.
Making exceptions for \"liquidity\" is too vague, and literally any party engaged in ABS dealing could use this as a defense to a conflict of interest accusation.
Mr. Gensler stated in the press release that it is his goal to regulate ABS to avoid 2008-style chicanery. However, to make exceptions for \"risk-mitigating hedging activities\" and \"market-making activities\" is tantamount to granting immunity for investment banks, prime brokers, hedge funds, and market makers.
The very same parties that in 2008, facilitated unsustainable MBS sales, built massive un-examined MBS holdings, and procured insurance policies (CDS) from doomed organizations (AIG).
Within my lifetime, the SEC has been a friend and servant to the institutions it was meant to regulate. Please take a stand now and provide meaningful regulation on ABS to protect the stability of our financial system. Please remove any and all exceptions to this regulation.
Thank you,
Chance Furgerson