Good morning.  I’m pleased to be here with all of you new and former GMAC members, and our presenters.  Thank you for taking the time to advise the Commission.  I want to thank Commissioner Pham for her leadership of this committee.  I value her experience on global issues.  I also value Chairman Behnam’s leadership on The Board of the International Organization of Securities Commissions (“IOSCO”).

In the last three years, commodity derivatives markets have faced unexpected global challenges and market disruptions.  Some were unexpected, hopefully once-in-a-lifetime events, like the pandemic and Russian war.  Others, like climate events and cybercrime, have been building for years, and we should expect that markets will continue to grapple with them indefinitely.

What can we learn from these challenges? And how can all of us work together to plan for future challenges?  I am interested in hearing your perspectives on these questions.

We have arrived at a time when we should expect the unexpected.  By expecting the unexpected, exchanges, clearinghouses, intermediaries, the Commission, and others can prepare a game plan for future market challenges—a game plan that holds the lessons of past disruptions but also has the flexibility to adapt to new challenges.

There is great benefit to clear-heads planning now.  Advanced planning can help ensure there is appropriate liquidity during times of market stress.  Advanced planning can help ensure that extreme volatility does not impede market fundamentals.  There is also benefit to considering whether there are bumper guards that should be put in place to help markets remain resilient through disruptive events.  It is also important to determine in advance how key decisions will be approached in areas like initial margin, as well as the timing of mark-to-market for variation margin.

These and other complex issues impacting global derivatives markets would benefit from forward thinking.  Working through them now with clear heads and the benefit of time can lead to a workable game plan that will keep markets functioning well during times of stress.

I also want to emphasize the importance of surveillance of abusive trading practices during times of stress.  I have repeatedly raised this issue, including when recently speaking to 14 Asian regional exchanges.  It is an issue that IOSCO focused on in their revised Principles for the Regulation and Supervision of Commodity Derivatives Markets to ensure integrity.[1]  Ensuring that nefarious actors do not take advantage of market disruptions is foundational to proper market function during times of stress.

Finally, when it comes to climate change and cybercrime, we know what to expect.  This means we can plan around it.  We can manage the risk.  Together, the public and private sector can use every tool to build market resilience.[2]

In my nearly one year serving on the Commission, I have seen the global derivatives community pull together.  Our markets have functioned well during daunting times.  I am pleased that all of you have agreed to serve on this committee and advise the Commission.  Your diverse voices and viewpoints are welcomed.