Background on the President’s Working Group on Financial Markets
The President’s Working Group on Financial Markets (the "Working Group") was established by Executive Order 12631 in March 1988 in response to the stock market crash in October 1987. The chairman of the Working Group is the Secretary of the Treasury, and the other members are the chairmen of the Board of Governors of the Federal Reserve System, the Securities and Exchange Commission, and the Commodity Futures Trading Commission.
The Working Group issued its report on the 1987 market crash in May 1988, and conducted follow-up work in 1991. The Working Group did not meet regularly in the early 1990s and was relatively inactive until 1994, when it was reactivated by then-Secretary Bentsen.
Although the Working Group was created originally to address issues related to the 1987 stock market crash, it now serves as a forum through which the participating agencies exchange information on and coordinate regulatory policy regarding U.S. financial markets more generally. For example, the Working Group has drafted and proposed legislation designed to improve financial contract netting, and it has written reports and developed recommendations on circuit breakers, hedge funds, and over-the-counter derivatives markets. It also is a forum used to exchange information during market turmoil through ad hoc conference calls and meetings.