CME's Duffy on Illinois Trading Tax and Spoofing

The transcript discusses a proposed tax on CME trades, highlighting its potential negative impact on liquidity providers and the Illinois economy. The speaker argues against the tax, suggesting it could drive business away from Illinois. The discussion also covers CME's strategic changes, competition, and efforts to ensure fairness in trading. The transcript addresses concerns about spoofing and manipulation, detailing CME's preventative measures. Finally, it explores the potential impact of Fed rate hikes on CME's trading activities.

What is the proposed tax rate on trades in Illinois?

• $1.15 per trade

• $0.40 per trade

• $2.00 per trade

• $0.80 per trade

What is the main reason the speaker opposes the tax proposal?

• It encourages more trading.

• It is too low to be effective.

• It benefits only large traders.

• It is based on notional value.

What might cause CME to move out of Illinois?

• New technological advancements

• Pressure from competitors

• Better opportunities in other states

• Lack of customers due to high trading costs

What strategic changes did CME make in 2007 and 2008?

• Partnered with tech companies

• Expanded into Asian markets

• Introduced new trading software

• Acquired Board of Trade and New York Mercantile Exchange

How does CME ensure fairness in trading speed?

• By offering discounts to frequent traders

• By limiting the number of trades per day

• By prioritizing high-frequency traders

• By upgrading data lines for equal speed

What is CME's stance on spoofing?

• It is allowed under certain conditions.

• It is strictly prohibited.

• It is monitored but not regulated.

• It is encouraged to increase liquidity.

What impact would a Fed rate hike have on CME?

• Decrease in trading activity

• Reduction in operational costs

• Shift to international markets

• Increase in interest rate product trading