[captions copyright national cable satellite corp. 2025] >> good afternoon. >> good afternoon. >> i am the chair and senior fellow in economics studies at the brookings institution and it's my pleasure on behalf of the center on regulation and markets to welcome you here to the fifth in our series of the future of financial regulation.

today, we will be having a conversation with cftc commissioner christy goldsmith romero whom i will introduce in a moment but i want to start the conversation by anchoring why this is particularly important. america is unique in many aspects, one of which is we divide the regulation of markets between stocks and bonds and between commodities in futures, derivatives between two different regulators. this has its roots in one of the oldest political and economic divisions in america between banks and farmers. farmers, for obvious reasons, always needed credit since they had a seasonal product and source of income, and bankers were the ones who lent to the farmers for good times and for

bad, taking risk and exposure depending on how the crop went and over time, this fight between bankers and farmers has shaped much of modern america in ways we may not appreciate, one of which is to carve out the regulation of commodities which later included derivatives, futures, and options and may, going forward, to a greater extent, include cryptocurrency, bitcoin, and other crypto's who display a lot of functions and make them think more like commodities like digital gold, so to speak, than a stock, bond, valuable company and security. i am not a lawyer to wade into this. congress is considering legislation right now on that but what i will point out is that the futures in commodities regulation has shaped all of our daily life. everyone here who booked a flight for summer vacation or is

going to book one for thanksgiving or christmas, you will book the flight with a known price today even though when the airline takes off, it may not know how much it is spending for fuel in part because there is a viable futures and commodities market that lets businesses >> what their future risk and exposure is and translate it to consumers so you know what you are paying now regardless. this function of this market may seem very esoteric and that me tell you, there are a lot of people in wall street that make it some really complicated and get a lot of money from that. this market needs to be regulated wisely. and for that, america owes a great debt to the cftc including two commissioner goldsmith romero and before joining the cftc, she has had an illustrious career. she served with amazing distinction as the special inspector general for the troubled asset relief program or

tarp which is basically the program that helped save and stabilize our banking system and national economy after the financial crisis of 2008. in addition to being the special inspector general safeguarding taxpayer money and prosecuting criminal wrongdoing, she served before that as a senior counsel on the securities and exchange commission, served as a clerk for a judge and has devoted her career to advancing the integrity and well-functioning of markets while safeguarding and protecting consumers and with that illustrious career, her service and tenure of distinction is great. it is an honor and privilege to welcome her to the stage for some remarks come after which we will start the conversation. so, commissioner? [applause]

hon. romero: thank you to brookings for inviting me to give my fear will remarks as i depart from the commission and i'm going to retire from 23 years of federal service so for the last time, i will give my disclaimer that the views i'm going to give our my own as a commissioner and do not necessarily reflect the views of the commission or my fellow commissioners. i have been reflecting on my public service under four presidents and today, i am feeling nostalgic because i have had such a good run. i want to express my gratitude to so many. first off, my wife and children. my wife is here today. i'm also grateful to president biden and president obama for the long and trusting me with three presidential nominations. i'm grateful for the senators in both parties who actively supported me and unanimously confirmed me twice. i'm grateful for all the leaders

with whom i've had the privilege to serve including my fellow commissioners. i'm grateful to all my staff, the hundreds of people who have worked for me and put their trust in my leadership. never could i have planned or envisioned such a meaningful and fulfilling career. all i knew was that i had a passion to make a difference in our financial system so that it served everyone, not just powerful interests, and along the way, i learn from each of the leaders that work for, my sec enforcement leaders, chris cox and mary shapiro and at treasury, neil borofsky before me. never could i have imagined my work would get the notice of president obama who appointed me as -- in 2012. i can share that it was entirely daunting to be a 41-year-old career staffer sitting on the same senate banking confirmation

panel with jay powell. of course, that meant i did not get many questions but don't worry. senate banking would make up for that this past summer when i got two plus hours of questions in my confirmation hearing to be the fdic chairman. i was forged by fire, as were all of us who worked to strengthen the financial crisis -- the financial system in the wake of the 2008 financial crisis. and the former fbi sea chair, supported me this summer, drawing on the work that we did during the financial crisis. last year, i was at treasury and i ran into former treasury secretary paulson who remembered me, and he said, those were the days. look at what we did for the economy. it's also where i honed my leadership of white-collar law enforcement. we worked closely with doj to bring justice and accountability

to just about every major wall street financial institution and 465 criminal defendants. this includes 76 bankers who courts sent to prison for crimes. i continue to feel tremendous affection and gratitude to all those who served as i learned in valuable lessons about how to lead an organization. it's also where i found my voice and the courage to speak truth to power. it was a necessity when testifying before congress and meeting with treasury secretary's, federal reserve chair, the fdic chair, and attorneys general. as it was winding down, i was fortunate to be contacted by several senators and president biden's white house about a possible next appointment and various financial regulators were discussed and i raised the possibility of the cftc. first, i had always enjoyed in a market regulator and second, i

was interested in climate related financial issues and the chairman had sponsored a climate report and was speaking a lot on climate issues. third, the cftc was the only regulator of cryptocurrency trading and i had been teaching cryptocurrency regulation at two law schools. as a commissioner, i was able to prioritize all three of these areas, broadening crypto out to technology as i sponsored the technology advisory committee. the accomplishment i am most proud about in my tenure is that derivatives markets worked well, that they remained resilient and vibrant and had integrity. since my testimony at my confirmation hearing in 2022, i have always said that ensuring markets worked well would be my highest priority. this was so critical because the markets the cftc regulates tied directly to the economy.

that tie is something i have had the privilege to see firsthand. what incredible experiences i have had to get out of washington, go on agricultural toilers and energy tours, to meet with people who are feeding and fueling our world, to truly understand the way markets work, you have to engage with those who rely on those markets and who need them the most. i'm also proud of the technology advisory committee for its work on future of finance issues and grateful for the committee members who we picked because they were well regarded experts in cryptocurrency, stable coin, ai, block chain, cyber, and syntax, and -- fintech, and who come from all different viewpoints. we held public forums and the committee issued two landmark reports. the first on decentralized finance and the second on responsible ai in financial markets.

as i contemplate the future of financial services regulation, my thoughts keep returning to an area that i speak a lot about. promoting market resilience. resilience is defined as the ability to balance back quickly from setbacks. u.s. markets and global markets have and will continue to experience periods of volatility and stress. i arrived at the commission in early 2022 in a time of geopolitical uncertainty. the economy was recovering from the pandemic, suffering supply chain disruption, and oil and gas markets were at record high levels of volatility and prices after the start of russia's war with ukraine. fortunately, what i found was the postcrisis reforms through the dodd frank act, other regulation, and supervisory regulatory supervision built up resilience and as a result, our markets have withstood significant stress and volatility including last month

and our economy has been better for it. as the current administration pursues a deregulatory agenda in the name of growth, care should be taken not to remove the loadbearing resilience built into our markets. resilience that has resulted in financial stability and protected our economy. regulators should not have to sacrifice growth for financial stability. these are not mutually excused -- exclusive goals and regulators should promote both. growth is important for markets. growth requires a regulatory environment where markets are financially stable and resilient during times of volatility, uncertainty, and stress. i'm concerned about big swings between more regulation and deregulation with each change of party in the white house. this leads to uncertainty in

markets. it would be better for our markets and financial system if regulators could follow a steady, consistent path. that would create the foundation for a resilient, stable, and vibrant financial system and economy. it's a really tough challenge, one that requires independent regulators engaging with each other on a bipartisan basis and engaging with many stakeholders who use and need u.s. markets. i plan to continue to share my voice and i will always be rooting for the cftc. after all, you can take the girl out of public service but you can't take public service out of the girl. thank you. [applause]

>> thank you for those wonderful remarks. i often think there are only two occupations anybody says they have a calling for. one is public service and the other is divinity. i never met anybody who told me they had a calling to be an investment banker and you know i often think about president kennedy's comment, ask not what your country can do for you but what you can do for your country, and you have done an awful lot. your service is legendary and has made a tremendous difference , and we will talk about that but this is washington. so what have you done for me lately? what is happening right now? and where are we going? right now on the floor of the united states senate is legislation regarding stable coins. as you point out, one of your hallmarks on your tenure as commissioner has been being the

sponsor of the technology advisory committee where you have looked at cryptocurrencies digital assets and thought deeply about what that regulation should be. it's been front and center whether that regulation should be -- what should be the role of the federal reserve? while this may sound like alphabet soup to many people, the culture and outlook of these different agencies, where it lies can be a remarkable impact on the future so i'm going to ask you a couple of questions on this and the first one may be the hardest which is put away what your opinion is, what you think is a good or bad idea but let's prognosticate a little bit about the future, right? we are here about the future of financial regulation. where do you think congress is going with regulation on crypto? >> first of all, i have been a proponent of congress to come out with legislation on digital

assets. if it's going to trade, it should be regulated. i am a regulator so that should not be a surprise. i would say one of the problems that we have is that bitcoin, ether, and other crypto assets are not regulated and people think that they are. and we see a lot of times people getting scammed or we see companies who want to engage in this space and it's not regulated and they want to come to the united states and do that so we start with that which is affectionately on the hill called market structure and this is the bill that has been kicking around and got pretty far on a bipartisan basis in the last congress that would divide up jurisdiction between the sec and cftc so there is a new version of that and i think that will take a little bit longer as these things always do because it involves two different committees on the hill.

it involves senate banking, senate agriculture, and then same is true in the house. >> this is that divide between farmers, for whom the commodities commission still reports to the senate agriculture committee, and banking, for which the securities and exchange, federal reserve can -- other people -- i worked on that committee for 8.5 years so i am always rooting for banking, just as you are always rooting for cftc. >> i worked at the fcc. i root for the sec paid what i root for is regulation that makes sense so i think that they will get there. bitcoin is a commodity. ether is a commodity so in its purest form, the trading of is not something the sec would normally cover but they would cover other things and they are going to cover exchanges and we are going to cover exchanges and clearing houses and brokers so all of that is going to happen and then stable coin is the other one in that one is farther along and this is really interesting because this is

where a lot of the financial institutions want to get involved in the financial institutions, a lot of them very much want to have stable coin legislation so that they can get into that space. i think that will go first but both have bipartisan support. >> you think there will be a stable coin goal signed by the president this year? >> i think we are close. it got a lot farther along i think than the market structure built in. there still important questions about sec versus cftc jurisdiction and obviously, there has been a big change in the leadership with leadership that is more open to regulating crypto and that changed a lot. >> if that is where you think we are going, what do you think we should be doing? >> i have lots of thoughts on this. >> we have time. let's first off, i have long advocated for the cftc to have the definition of retail

customer. we don't have one and this makes sense because usually, we tell customers we are not engaged in the derivatives market. this makes sense but now we have seen this rise in retail in part because of crypto and other products. we don't have the same retail customer protection regime that the sec had that i was used to working with when i was at the sec. so i have advocated for, in any legislation, for the cftc that would give them authority that we would also have a definition of a retail customer. >> you lack the definition to do it right now question mike you could not define it even if you wanted to? once we could not. we have this weird thing called non-eligible contract participant which could include a hedge fund and someone with $10 million. we don't have it so congress would need to do it. i have not seen that yet in a bill although the chairwoman had

asked our chairman any hearing whether we should have it after i had been advocating or it and he said he thought that we did need that. >> it is so important because there is a general theory which is that retail people need greater protection. if you are trading on behalf of a multibillion-dollar entity -- if you screw up, you should have spent some time looking at this. individuals are given a much larger set of protections, much larger set of disclosures, and frankly, a more narrow set of allocable assets that they can invest in because of the idea that they don't want to have people lose their life savings. you said you thought this thing is a commodity. anything that trades, you know, i thought, wait a second, i traded a lot of baseball cards and took a bath in the baseball card market, as many people of my generation did. those marc mcguire rookie cards are not the appreciating asset i thought they were.

i don't think i needed the government to regulate the card market or the bbb market, to use a different analogy. much of the government regulated the crypto market. hon. romero: if people are trading in it than i think it have seen the damage that can come when it is not regulated even a ban against co-mingling a company's assets with customer assets. i mean, that seems extreme the basic. anti-money laundering. anti-sanctions evasion, anti-terrorist financing so ultimately, look, i came with an investor protector regime. you want people to know their rights. if they take a risk and they lose, that is on them but you want to have some basic things like exchanges that are registered that have some basic requirements and have to follow the law so this is what i think

is the main thing that needs to happen. on top of that, i do think anyone involved, brokers, exchanges, clearing houses, that are going to be involved in trading in this space and facilitating the trades in this space need to be registered either with the sec or cftc or in some cases, both, depending upon what they are going to allow the trading on and they need to follow the rules and the law and i think illicit finance needs to be protected against. i brought a lot of money laundering investigations and put a lot of people in jail for that and that is an area that crypto needs to really mature out of the anonymity -- desire for anonymity tomorrow like financial privacy which financial institutions have been long used to covering. >> what do you think is the biggest mistake that you think we are on track to make in the crypto world and crypto regulation or lack there of and how do you think we can avoid it?

>> let me say i don't think this will happen but to the extent that crypto would get very large in terms of the market and get very integrated with traditional finance, questions could arise about whether it raises to the level of systemic risk at which point i think treasury and banking regulators have to get involved but for right now, i don't think it is there. for right now, we need to make sure the biggest risk is that there's not regulatory gaps, regulatory arbitrage where someone is trying to play games and choose one regulator over the other, thinking what is going to be weaker than the other. >> that is one of the big concerns opponents of this thing have made about the argument that they are going to go to the cftc because of a belief that the cftc is easier. >> the thing that is wrong about that is not that the cftc is easier. it's that the cftc is a principles-based organization. >> that sounds good.

i like principles. >> principles are good so there's some flexibility in the application of principles-based regulation where you are not telling every company they have to do everything the exact same way. it depends on that company. that puts a burden on the company followed by revelatory supervision where the regulator is making sure they are doing what they are supposed to do. the fact that our markets have done so well will show you that we are not an easy regulator. our markets have been strong with regulation and that helps make it some of the deepest, most liquid, most trusted rockets in the world. >> one of the concerns i have always had with that argument is one of your predecessors famously argued to regulate derivatives, particularly of subprime mortgages, far more aggressively and for federal reserve chairman, alan greenspan, who was required by law to regulate subprime mortgages and summed his nose at

the law, saying i know better. that regulation is not necessary, a practice the federal reserve still does to this day in many ways, strong-armed and basically with the help of treasury and other people, pushed it down and cftc did not step in and we know what happened with the derivatives of subprime mortgages and chairman greenspan went before congress. sorry, i made a mistake. did not wipe out his life savings. i don't know how many federal reserve staff were evicted or lost their home. i do know that 5 million americans were foreclosed and this idea about strong versus weak regulator i -- i think the question of vision and the ability. there is a power dynamic that's very much at play in washington that the rest of the world may not see where the federal reserve can bigfoot other regulators even if it's not in the area. let's talk fully about your tenure at the cftc because you

know, you have a long career, you are leaving -- he talked about your sponsorship in the technological advisory committee and the ai committee. talk about some more of those and other accomplishments you are proud of in your tenure at the commission. >> so obviously, as i said, number one is that the markets worked well. this is not headline grabbing stuff. we don't want to be in the headlines on this. you want the markets to work well and you want companies and people and farmers and energy producers and everyone who uses treasury futures and interest rate derivatives to be able to count on that and then the second is the work we did in the technology advisory committees so we really embrace the idea of promoting responsible innovation. like i always say, if the government does not keep pace with technology, the most vulnerable will suffer. government is always behind on technology but to the extent we

can cut that gap and really keep up-to-date on what is happening and have the best and brightest minds and bring experts into help us, then we can understand things better as we are making decisions about policies so a lot of the work we did was on ai so i knew right away with this evolution of ai that i would need to bring in experts and i had to convince these people will to come and serve on the committee and a lot of them did not know who the cftc was but i said you are an expert in ai and i need your expertise and when we applied what is happening with ai to financial markets, they were really invaluable. i also used them for my work on cybersecurity. and i let the cftc's efforts on cyber resilience and led the drafting of the first proposed cyber resilience rule for banks and brokers which got a 50-0

-- 5-0 vote from the committee's are very proud of that. these are the types of things we were working on all while i will say i'm proud of the work we did promoting responsible innovation in crypto. until you actually regulate the trading of crypto, you don't really understand all the nuances and all the details that go into the decisions that you have to make. how do you increase customer protections? how do you increase anti-money laundering controls? so there were a number of issues that would come up. how do you visit settle crypto and other issues that until you actually regulated the trading, you just were not aware of it? we did a lot of work in this area as well as where things are -- where are things going with block came? where are things going with digital identity which is going to be a very interesting concept going forward? works that as a whole subject, digital identity, that is radically needed. you know, we have a state based

-- the majority of americans don't have federal photo identification by which i mean a passport by the -- by the way, ask yourself how many people in your friends and family network have and don't have a passport. slightly more americans do not have a passport then do. you mentioned ai and put out a report on ai. we had a two day event here at brookings with the financial stability oversight committee on ai before. how do you think about the role of the government in ai going forward? a lot of people think that is going to be a massive change whereas you point out behind the curve, the government is never going to be the lead creator of ai content and regulation. what do you think we should do going forward on this? hon. romero: i spent a lot of time, since i really that the cftc's work on ai, using these ai experts, spent a lot of time talking with our exchanges, with

our clearinghouse, with brokers, to say how are you thinking about the evolution of ai? so i brought all these experts in and i said, tell us what we need to be worried about. >> they said ai has been around in financial markets for years and years and years. it evolution of -- of ai that we need to be paying attention to. they wrote a terrific report which explains these concepts that really need to be understood like where do humans fit in? this idea of humans in the loop, humans over the loop and when i said, well, what do you recommend for us? they said we don't want to step on the evolution of ai. we think probably your rules already require a lot of work related to ai already with risk management and other resilience things. so do that, get your capacity up internally at the cftc, start talking to all your regulated

entities paid i said, well, should we come up with any new regulations? they say, there are two things we want you to consider. the first, when it comes to new regulation, is governance requirements so we are going to go really back to foundational ideas like if a company wants to commit to responsible deployment and use of ai, then they need government -- governance requirements. is there going to be a risk committee? are the executives going to be involved? who is going to be involved in deciding what types of risk they are going to take and who will be making sure that the use of that ai remains responsible? the second is just best practices. they said -- the gold standard. >> national institute of standards and technology up in montgomery county, maryland. >> they have an ai risk management framework and we brought in this to explain and they said they have some number of very specific requirements

for anybody using ai should follow to get a hold of the risks and to be able to use on the benefit of ai so those were the two new things but they said it's really just a matter of continuing to invest in ai in terms of what we know about it as a regulator, continuing to keep up with the use cases that registered entities will be using it for and that is a continuing conversation. >> let me ask you -- we talked a lot about the future. you know, every stint i have had in government, i have gone back and i thought, i wish i would have done this different. i wish i would have done that different. when i was at the treasury department, i had the special inspector general telling me what to do differently on a regular basis. >> not going to apologize for that. >> you shouldn't because let me tell you, when you are the special inspector general, it

was such a better experience. when you are in government and making big consequential decisions, they are hard. they are difficult and you have to make them in real time and you are not going to get all of them right. and feedback on that is very valuable. sometimes in this town, we are like porcupines and we get our bristly and on the outside, we are rejecting all of this. no, no, no. we got it right. we come back in and we are like that was a fair point. next time, we are going to take the feedback and try and do it better. it's always easier to criticize than to make. i remember when i was trying to learn how to do pottery and clay. the cannibal and do -- i would have done this better and then i try and make one. but your points there were invaluable and they made the process better. >> thank you. >> not sure i would have said that about your predecessor but we can hold that conversation for a different day. when you look back on it, you

know, how would you say, you know what, i wish i would have done this one a little better or different? hon. romero: i wish i would say as the cftc commissioner, i wish i had had some more time and been on the hill more on this definition of retail customer. i really wish i would have pushed that harder so that the legislation that is coming out now would have that and be able to have the cftc -- >> any member of congress or staff watch and come up with that amendment on the senate floor is what you are saying? hon. romero: put it on, please fit in needs to happen. to the extent we are going to have more retail customers at the cftc, there does need to be a definition of retail customers and retail customer protection regime. i would have liked to do a lot more on ai. i think there is a lot that is about to happen there. i think there is a lot that is about to explode there. and i think in a good way, i

think there's a lot of real benefit that can come out of it. i think in terms of regulators keeping pace with that and getting involved in that and making sure you are having the promise of ai but you are looking out for risk is going to be really important. i would have loved if we finalized the cyber resilience will. we did not get that finished. and i just think that more could be done in terms of -- i would have liked to be here as they get new crypto authority to do the rule writing on that and to be able to do the customer protection regime. i think that would have been great. press anti-money laundering, sorry. >> i am a bit of the acronym. let me say about the commodities futures trading commission, you were established to be a five-member bipartisan board, democrats and republicans, as is the case with most of our financial regulators.

going forward with your departure and that of some of your colleagues, you are going to be down to one member. the president has no interest, it appears, in appointing minority members. in fact, he fired minority members of other regulators earlier. we heard from the former chairman of the national who was fired by president trump in violation of the law and existing supreme court precedent as he sees it. he filed a case -- any reasonable person would say it's a violation of the supreme court's humphrey the executor precedent that the court may overturn itself. the president does not seem to want bipartisan boards. your board is going to be down to one member which i think hampers its rule writing authority by its nature and structure. what do you think the future holds for this? >> i think it hampers all types

of a regulator in terms of what they can do if you are not going to have a full, independent bipartisan board. i mean, we had a full five for almost my entire tenure. and there is something great about the push and pull that comes from talking with someone with a different viewpoint and from thinking about how do we make something that is more long-lasting? we are not looking to have a situation that swings this way every four years, swings that way. ideally, we push and pull each other and come up with the right results and it lasts and to the extent that you start to have these party-line vote's, they tend to not last because the next and that party is in power who was on the losing end as they see it, they are going to just reverse every so what we need to do is work together. we compromised a lot. i convinced them -- them of

things and they convince me of things and when i say them, i'm talking about party. i'm talking about my other four commissioners. we all have different viewpoints and experiences. bringing that altogether is really helpful so what happens if the cftc gets down to one and gets new authority for crypto? it's going to be really, really hard, right? you are not going to have the same push and pull. you're not going to say -- have people who say i spent my year doing financial stability and i think we need this for financial stability. we need to be more focused on customer protections so i worry about that. our he about that at other agencies as well. >> i worry about the idea that if the other group did it, it's wrong, and i'm going to just reject what they did because they were the author. >> i agree. >> the federalist papers wisely did not give who their authors were.

i worked on a statistical technique to try to tell who authored what and it turned out by the use of the word whom, you could make a pretty good guess but it took almost an ai level computing power to do that and it was done because there was a part of the country that would not have agreed with anything that hamilton roche and another part that would not have agreed with anything madison wrote so they said we are just going to put it out on authored and nobody quite knew who wrote so they went along and i'm worried about that we have seen that growth in financial regulation and i think it's fair to say we saw that to some degree at the fdic which was the place where you were nominated to chair, nominated to chair it and went through a grilling on the senate banking committee and so it did not end up confirming you with the election on the horizon. it's rare to get a five-year term and who knows have you been confirmed whether that term would have been honored.

tell us about what that experience was like and what your takeaways were from it. >> let me first go back to something you just rates. you know, we are not chosen because we are politicians so we are not here to play politics when we are a regulator. we are chosen for our financial expertise and that's working together -- people with financial expertise coming from different viewpoints works really well when you put it together. we don't really think of it as we are voting on things as by party. the fdic experience was amazing, excellent. i met some wonderful, wonderful people at the fdic and i got to work on getting prepared to do some really heavy, interesting issues on n mergers and technology. it was the kind of job that would have brought all of my

experiences and skills and background to bear. i was treating -- treated very well by the senate and i had bipartisan support. they just did not get to the vote in time before the election and at that point, i decided not to move forward so that the president could choose but i had a wonderful experience with them. i had looked forward to meeting them and helping them out of work as cultural issues. >> any suggestions you would give to the next person who assumes that position? >> i think you have to say there is an acting chair right now, whether it is him or someone else. >> you have to look at the natural purpose of the fdic. it has got such an important mission. how do we protect that most of all? people trust in that name and so how do you make sure that you restore and keep that trust? we are going to turn to questions from the audience in a moment.

what do you see as the three biggest challenges facing the commodities and futures trading commission? i'm going to say over the next five years because that is a term you are given in the outlook so if you had to say what are the three challenges that are going to be facing the commission over the next five years? >> the rise in retail is going to be one for sure. i think geopolitical uncertainty is going to continue to be the case. i mean, i always say you should expect the unexpected because then the collective "we" can kind of plan for that. when you look at the derivatives market and the stress that will continue to happen, that is why we need to build in all of this resilience into these markets and here, i think about liquidity risk. i have been following closely the treasury bond market. we regulate the treasury futures market that obviously, we pay attention to the cash market. this is collateral for margins

for so many people so these are all areas where we want to make sure the liquidity is there when it is needed and that led -- and then let me add on climate change because it was one of the areas that i was interested in coming to the cftc about. these markets are absolutely impacted by climate disasters. we are talking about farmers, agricultural producers, and energy producers and there is a direct tide. this isn't politics. it's markets so this is going to be an area where the cftc needs to continue to monitor the effect of markets by the climate disasters that we have been seeing. >> you said something earlier that i thought was very wise where you talked about the asymmetry in regulators getting something right or something wrong. and the way i internalized it is i have never seen a front-page story, food regulation awesome, no salmonella outbreak last year. and now, cutting all these food inspectors, we may come to

realize we have taken that for granted although if you look back at upton sinclair and the history, people used to be afraid to go to restaurants hundred 50 years ago -- 150 years ago because restaurants were where you got sick. who knows how they prepared it. now, i tend to think most people take for granted that you are going to go out where the food you are going to buy is inspected and financial regulators face that kind of same risk and that could be very true in climate. nobody said, you know, you guys protected us by looking around the corner for this climate disaster. are you afraid we are going to make that mistake? hon. romero: i look at it from a market perspective so when i see the markets being completely impacted when there is a climate disaster and how that relates to dollars and cents in markets that people rely on, it is certainly something that has to continue to be monitored just as

much as geopolitical risk or cyber risk or other risk that is out there. >> take a look for who has questions. i will turn to the audience for a second. please speak into the microphone so that everybody here and in the livestream universe can hear you. i'm going to ask that you state your name, your affiliation, and i am going to ask that you ask a question had i think that is fair because this is a question portion so please, you can find your comments to be brief so we can get several folks. the gentleman here and a woman to his right? >> thank you, very much. i am lopez from hopkins. you make the distinction that you regulators are chosen by financial expertise, not by your politics. but in fact we know that both are related so how can you

incorporate that in the law so that we know -- but first, we should have the citizens should have the right to have in the regulation individuals that are chosen by their expertise and if they have a political view -- debatable or expendable or something like that, how to incorporate that in the law, that is my question. thank you. hon. romero: i appreciate the question. we start with having these full independent commissions and boards that have a balance of different people from different parties that's up to the president and the senate to make sure that the nominations and the confirmations are for people based on their experience and their background and they -- they have the expertise to lead it.

we should not come into any decision starting with what party am i and what with that party want to choose? that is not how i have approached any decision in my entire career. the question is what is the right thing to do? that is the question. and if we can talk with each other and have respect for each other there are many things that we all can agree on. things like building resilience, that's really important so that the markets can bear stress that's about to calm because stress and volatility will always be there. >> i am a reporter -- going back to the issue of what might happen with fewer commissioners, i was hoping you could clarify, can the cftc still issue rules with one or two commissioners or with that put rulemaking on hold until you are confirmed? >> i think we have different quorum rules and i am not the

general counsel for the cftc so i'm not going to give a legal opinion on that but i think it gets more difficult and it's not a great situation if you have one person who is determining what the rules should be. you lose the benefit of this back and forth, this push and pull as to what is the right thing to do and i have always wanted to hear from my fellow commissioners about what makes sense to them and there are many things that they have convinced me of an many things that i have convinced them so i think it does a disservice to regulation. >> the woman in sunglasses in the back. >> if you could talk about the dollarization and the pace of it, what your concerns are about the threat to intensify after sanctions, you can talk about the dollarization -- de dollarization and your role? >> to the extent we are talking about, not sure if you are asking a question about able

coins versus dollar already question about >> just the world. we in america -- yes. we in america enjoy a unique status in the world. when you go anywhere else in the world and they want to figure out what the price of a flight is in december, they have to do two things. one, they have to guess what the price of the jet fuel is going to be on the price of oil. two, they have to guess what the price of their currencies going to be vis-a-vis the dollars that the oil is priced in pure only in the united states we just avoid that one step about currency risk which for many countries and airlines is very real and one of the arguments many economists have made is that our businesses and firms get a huge advantage by being the global world currency. this administration seem to argue that we pay a price for being the world currency and seems much more open to promoting alternative world

currencies or put a different way, pulling the united states back from their role as being the global provider of the world's currency. >> i think the dollar will continue to be the reserve currency. i was just in amsterdam at an international conference where this was discussed a lot. there is not an alternative. that doesn't mean we don't need to pay very close attention to what we are doing with the dollar with what is happening with treasury markets. from the cftc sees perspective, we regulate the treasury's futures markets so i am heavily involved in monitoring data as well as what is going on in the treasury cash markets. now, there's a lot happening in that space right now for all these efforts to build resilience into those markets and that is all coming together now. i just recently this weekend last week cap briefings on the treasury markets so this is all something we are paying very close attention to but there is not another alternative right now to the dollar as the reserve currency.

>> hold on. i want to give other folks an opportunity. woman in the front row. hold on one second. i think there is a microphone. >> hello. private sector. the director of cifi, a consultant company for artificial intelligence. my question is tied up to the answer to the first question. you guys like to work as a team and for the first time, i heard from you that there are no silos so because everybody has silos, i heard for decades, and silos exist today so my question is is this only in the ftc or other

financial institutions which finally, they talk to each other to make financial decisions? thank you. >> i mean, we talk to each other all the time. the different regulators, we all know each other and meet with each other regularly. we follow what each other are doing and talk to each other. after the financial crisis where there was a lot of silos, a lot of work was put in to fixing that so that we could very coordinated and talk with each other and we cooperate with each other. i think one of the things that happens is that doesn't just happen on a domestic stage. that happens on an international stage so we are also in conversations of coordination with international financial regulators as well. >> how much of it is the club of regulators? and i appreciate that. i worked in the treasury department which is not a regulator.

i may try to play one on tv sometimes. the club of regulators says they work well together particularly on stage and then you know, when something happens, they go to congress and say it was them. the financial crisis afterwards, you know, the fed said the problem was the bank and the banks of the problem was with the holding company, the fed, and the fdic said we were the backup regulator and no one shared information without and it's all, you know, this. and you know, the original idea behind dodd frank was to combine the regulators, bank regulators, not the sec and cftc, and that got voted down. the senator lost that vote 90-9 on the floor of the united states senate and instead, they created this financial stability oversight council that was supposed to bring all the regulators together. it was like the jedi council and anyone else here who is a star wars geek may recall that was

led by yoda and lost. they were defeated in the financial stability council sat around and thought about systemic risk and all this stuff and we had a wave of deregulation in the first trump administration and we were all told silicon valley bank, not systemic, and then it failed, then whoops, it is systemic and we had to bail it out. the single largest depositor was a cryptocurrency company. $3 billion. the stable coin was not so stable during the weekend when it wasn't clear if they were going to get a bailout. so i know that right now, you are in a fascinating moment in your life and your arc where you are still a member of the club, still at the cftc but you know, you are not going to be in the future. how much is it united front upfront and then, you know, we are doing our job but it's

really their fault? >> i think it has changed a lot. i worked as counsel to the fcc chairman when the crisis hit. and then the next fcc chairman before i moved over into treasury. i have seen a significant change . not only do we have a more formal body but we have working groups and communication with our staff which is really important. it's not just the presidential appointee stage. it is that our staff level for us to be able to call and talk with each other and there is a lot of conversations that happen internationally but then domestically and just between regulators from whatever the issue is, it's not just banking regulators. the cftc would get involved as well and i would have conversations about basel with the fed from the cftc's

perspective so those conversations continue and i think it's much better than it used to be. now to the extent that something new happens in the future, we shall see what happens. i hope that the conversations are going to continue. i think that requires to have full commissions and boards. you cannot have one person doing everything so that is all part of it. you want to be able to bring in all these relationships, all this coordination, all this discussion. >> one person can't do everything. and you have done a tremendous amount in your career and you said this is your retirement after 23 years, but you don't look to me like a person who is ready to retire and sell off into the second -- sail off into the sunset. tell me what is in the future for you. hon. romero: i don't think i'm sailing off into the sunset too much. i'm going to join the faculty of georgetown law school where i

have taught a few years so i am excited to do that and then i will continue to share my voice, whether it's a think tank or other avenues but you know, i have got a lot to say and i would like to share it. and i would like to continue to contribute and i would like to teach the next generation coming up and maybe i can teach them some of this about how to be less political and to use their financial expertise and to work together and to talk to each other no matter what your party is. >> join me in congratulating commissioner romero and we hope to hear much more in the future as well. [applause]

bobout motivation is my honor to introduce this morning's commencement speaker the 45th and 47 the president of the united states president donald j trump.