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Viewpoint: news from the laundry room

7 April 2020

By

Walt Lukken

Greetings to FIA members from my home office on Capitol Hill where I split my days between my makeshift offices in my laundry room and basement.  It’s certainly not glamorous but the good news is that I can simultaneously advocate for our markets while knocking off a couple of loads of laundry.  Please post a picture of your home office on Twitter or LinkedIn with the hashtag #futuresindustryhomeoffice and we promise to recognize the best ones!

I have tried to keep a routine during these past three weeks of working remotely, but it is challenging.  While much of my life feels out of my control, I have vowed to wear a tie each day to prove I control something in my life.  Thankfully, my family is home and healthy, and I certainly hope you and your families are safe as well.

These are extraordinary times we are in.  Many of us have lived through the hardships of 9/11 and the 2008 financial crisis.  But who could have predicted that a silent enemy would threaten the health of millions and shut down the global economy in a matter of weeks?  

With every news channel broadcasting the horror of this reality, it’s hard to see the other side of the crisis right now.  How long will this last?  How will my loved ones be affected?  When will life go back to normal? 

One thing that helps me get through this anxious time is to focus on what I can control and to find ways to express gratitude every day.  And despite the circumstances, there are so many reasons to be grateful.    

I am grateful for first responders and healthcare workers—the true heroes who are battling the coronavirus on the frontlines.   I am grateful for the teachers who have found creative ways to engage with our children online and lessen their anxieties. I am grateful that I have time to cook and have dinner with my entire family every night (ask about my short ribs).  And I am grateful that I’m not the head of the Big Cat industry after binge watching the Netflix series Tiger King! 

Importantly, I am grateful that I work in an industry as resilient and supportive as ours.  These past weeks I have witnessed tremendous resolve in the listed and cleared derivatives markets to keep these markets open and functioning.  Overall, the system has worked remarkably well during this time.

This is not by happenstance. Our industry lives, breathes and obsesses over risk management. You can’t go to an FIA event, working group or roundtable without hearing words like redundancy, controls, confidence levels, and continuity.  While we might not have predicted this crisis, our industry has frequently considered and practiced other market disruptions that have helped us prepare for this unique situation.  

FIA staff have also stepped up our efforts to serve this industry, despite working remotely from living rooms, basements and kitchen tables.  Our mission-driven focus has been to ensure our markets stay open to manage risk and discover prices for customers. 

When there were rumors of government authorities closing markets a few weeks back, FIA joined other trade associations in a letter strongly opposing this idea.  Closing the markets would be akin to banning news channels from broadcasting about the Coronavirus.  This would not stop the spread of the virus but only keep the public uninformed about it. 

Similarly, markets serve to centralize and disseminate information to investors and consumers so they can make rational decisions about where to put capital and how to manage risk.  While we may not always like the prices that markets provide, properly functioning markets are the best mechanism to reflect the economic reality of the situation and drive behavior accordingly. 

As we adjust to this new reality, FIA has increased its information sharing and advocacy on several issues to help its members.  FIA has created a dedicated Coronavirus webpage at fia.org that has information about FIA’s activity as well as notices from market and government authorities related to the Coronavirus. 

FIA has also stepped up its communication lines with regulators globally to ensure that we are synched up on how to keep markets safe and accessible.  Whether it’s the CFTC, FCA, BaFin, MAS or AFM, we have been in constant dialogue with these regulators during this time.

The work-from-home environment has also presented challenges that require additional flexibility in regulations, and I commend regulators for listening to market participants and providing relief for these situations. 
 
We are not out of this crisis by any means and it is easy to feel weighed down with the dire news and uncertainty.  When things feel overwhelming, it’s important to focus on the day in front of us and what we can control to make it better.  

I like the approach of Washington Nationals baseball manager Davey Martinez who led his team last year to a World Series championship.  After beginning last season with a 19-31 record, he began telling his players to focus only on winning the day.  He would say, “Hey, let’s go 1-0 today.”   That singular focus on "now” helped the Nationals make one of the biggest turnarounds in baseball history.

That’s not a bad philosophy when facing a crisis.  If you can do your best every day and focus on things in your control, the cumulative effect of this will lead to great things and will help our industry get through these critical days. 

After all, this industry has survived World Wars, terrorism attacks and the great recession.  We will get through this crisis and afterwards we will help the economy recover.  

I hope you know that FIA is here for you to help our members persevere one day at a time.  I look forward to the next time we gather as an industry.  But for now, stay healthy, stay grateful, and stay focused on the day before you and we will get through this together.

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