EuroCCP and EMCF merge | Securities Finance Monitor

EuroCCP and EMCF merge | Securities Finance Monitor

CCP's are the clearing houses for derivatives that were before just two party contracts. The clearing houses are middlemen who take collateral in exchange for clearing the trades between parties. This new business requires a lot of collateral, a lot of good collateral preferably. That makes pristine high quality treasury bonds in demand so uncle Ben Bernanke can continue to sell treasury bonds, his main and most important job.

The clearing houses could help, unless bad collateral floods the system, or unless the clearing houses take too much risk.

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