Speaking at the Annual International Banking Conference yesterday, Federal Reserve (Fed) governor Jerome Powell warned listeners that central clearing of derivatives was concentrating risk in the financial system and that we need to take action now to shore up what have become key focal points before the next crisis hits. “Moving a significant share of the $700 trillion OTC derivatives market to central clearing will concentrate risk at CCPs. But the intent is not simply to concentrate risk, but also to reduce it–through netting of positions, greater transparency, better and more uniform risk-management practices, and more comprehensive regulation,” said Powell….