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Letter from Coalition From Derivatives End-Users to The Honorable Harry M. Reid

The Honorable Harry M. Reid
United States Senate
522 Hart Senate Office Building
Washington, DC 20510

Dear Senator Reid:

The undersigned companies and trade associations—representing diverse segments of American industry and serving virtually all U.S. consumers—support efforts by Congress to improve transparency, accountability and stability in the nation’s financial markets. As you develop a regulatory framework, we strongly urge policymakers to preserve the ability of companies to manage their individual risk exposures by ensuring access to reasonably priced and customized over-the-counter (OTC) derivative products.

Business end-users rely on OTC derivatives to manage risks including fluctuating currency exchange, interest rates, and commodity prices. By insulating companies from risk, customized OTC derivatives provide businesses with access to lower cost capital—enabling them to grow, make new investments and retain and create new jobs.

In contrast, some reform proposals would place an extraordinary burden on end-users of derivatives in every sector of the economy—including manufacturers, energy companies, utilities, healthcare companies and commercial real estate owners and developers. Specifically, proposals that would require all OTC derivatives used by business end-users to be centrally cleared, executed on exchanges or cash collateralized or subject endusers to capital charges, would inhibit companies from using these important risk management tools in the course of everyday business operations. These proposals, which would increase business risk and raise costs, are at cross purposes with the goals of lowering systemic risk and promoting economic recovery. In order to promote U.S. competitiveness and economic growth, policymakers must ensure that any financial services reform effort allows U.S. business to manage the risks inherent to their businesses. In today’s challenging economy, access to customized derivatives helps businesses maintain operations, invest in new technologies, build new plants and retain and expand workforces.

Thank you for your thoughtful consideration of our request. We look forward to working with you to promote stability and transparency as part of the ongoing economic recovery.

Sincerely,

3M
Acadia Realty Trust
Air Products and Chemicals, Inc.
Allegheny Technologies Incorporated
Alpha Natural Resources
AMB Property Corporation
AMC Entertainment Inc.
Ameren Services
American Chemistry Council
American Electric Power
American Forest & Paper Association
American Gas Association
American Residential Communities LLC
Anadarko Petroleum Corporation
API - American Petroleum Institute
Apple Inc.
ARAMARK Corporation
Associated Estates Realty Corporation
Association for Financial Professionals
Bayer Corporation
Behringer Harvard
Boston Scientific Corporation
BP America
Brady Corporation
Brookdale Senior Living Inc.
Bunge
Business Roundtable
Cabot Corporation
Cargill, Incorporated
Caterpillar Inc.
CDW Corporation
Chesapeake Energy Corporation
CNL Financial Group
Coca-Cola Bottling Company United, Inc.
Cohen Brothers Realty Corporation
Commercial Developments International, Inc.
Commodity Markets Council
Community Health Systems
Compass Minerals
Constellation Energy
Cooper Tire & Rubber Company
Corning Incorporated
Corporate Properties of the Americas, LLC
Covidien
Cummins Inc.
Deere & Company
Devon Energy
Digital Realty Trust
Direct Energy
Dominion
Donaldson Company, Inc.
DTE Energy
Duke Energy Corporation
Dynegy
Eastman Chemical Company
Eaton Corporation
Ecolab
Edens & Avant
Edison Electric Institute
EFCO Corp.
El Paso Corporation
Electric Power Supply Association (EPSA)
Eli Lilly and Company
Emdeon Inc.
Enbridge Energy Partners and Subsidiaries
EnCana Oil & Gas (USA) Inc.
Energy Future Holdings
Entergy Corporation
Exelon Corporation
Financial Executives International
First Energy
FMC Corporation
Ford Motor Company
Forest City Enterprises, Inc.
FPL Group
GDF SUEZ Energy North America
General Electric Company
GID Investment Advisers LLC
Goodrich Corporation
Grove Property Fund LLC
Harley-Davidson, Inc.
HCA Inc.
HCR ManorCare
Health Care REIT, Inc.
Helix Funds
Hersha Hospitality Trust
Hobbico, Inc.
Host Hotels & Resorts, Inc.
IBM
Independent Petroleum Association of America
Industrial Energy Consumers of America
Information Technology Industry Council
Intel Corporation
International Housewares Association
Invenergy LLC
Johnson & Johnson
KBS Capital Advisors
KBS Real Estate Investment Trust
KBS Real Estate Investment Trust II
Kinder Morgan
Lefrak Organization Inc
Legacy Reserves LP
Lexmark
Loews Corporation
MarkWest Energy Partners, L.P.
MeadWestvaco
Medtronic, Inc.
Meredith Corporation
Mid-America Apartment Communities, Inc.
MillerCoors
Millipore Corporation
Mississippi Manufacturers Association
Monday Properties
National Association of Manufacturers
National Association of Real Estate
Investment Trusts
Natural Gas Supply Association
National Grid
National Gypsum Company
Newfield Exploration
Northwestern Energy
Novation Capital
Novelis Inc.
NRG Energy
Owens-Illinois, Inc.
PPL Corporation
Praxair, Inc.
Procter & Gamble
Progress Energy
PSEG
Questar Energy
Regency Centers Corporation
Retail Energy Supply Association
Ryder System, Inc.
ScanSource Inc.
Sempra Energy
Shell Oil Company
Simon Property Group, Inc.
Simons Petroleum, Inc.
Southern Company
Stellar Industries, Inc.
Strategic Hotels & Resorts, Inc.
Superior Graphite Co.
Superior Woodcraft, Inc.
Tenaska Marketing Ventures
Tenaska Power Services
Targa Resources
Tennant Company
Teradata Corporation
The Boeing Company
The Commonwealth Group, LLC
The Durst Organization
The JBG Companies
The John Buck Company
The Pinnacle Companies
The Process Gas Consumers Group
The Real Estate Roundtable
The Williams Companies
Thomas Properties Group, Inc.
TRW Automotive
United Launch Alliance
U.S. Chamber of Commerce
Vanguard Natural Resources, LLC
Vermeer Corporation
Volvo Group North America
Washington Gas
Weather Risk Management Association
Weingarten Realty Investors
Weyerhaeuser Company
Whirlpool Corporation
Xcel Energy
Yocum Oil Company
Zimmer, Inc.

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