An article in the Wall Street Journal on proposals to change the regulations governing the trading of financial derivatives contained the following: The SEC and the Commodity Futures Trading Commission are both seeking greater authority to police the over-the-counter market and hope new powers can help them reduce the risks that over-the counter trading may pose to the broader system.
a. What is the "over-the-counter market" for derivatives?
b. What does the article mean by "broader system"?
c. How might over-the-counter trading of derivatives result in risks to the broader system?