Volcker: Separate Bank Speculation - DealBook Blog
From NYT Dealbook Blog: "Paul A. Volcker, the former Federal Reserve chairman, pushed his plan on Tuesday afternoon to tighten the investment activities of large banks in order to avoid future bailouts, telling the Senate Banking Committee that there was no “rationale for public funds — taxpayer funds — protecting and supporting essentially proprietary and speculative activities.”
“Hedge funds, private equity funds and trading activities unrelated to customer needs and continuing banking relationships should stand on their own, without the subsidies implied by public support for depository institutions,” he said in prepared testimony....
Mr. Volcker, an outside adviser to the Obama administration, wants to restrict proprietary trading by federally insured commercial banks and force them to divest themselves of hedge funds or private equity funds. President Obama has called the plan the Volcker Rule."
via dealbook.blogs.nytimes.com
Volcker's comments are simple common sense, but the likelihood of their being enacted seems small, particularly in light of last week's SOTUS decision that multinational corporations, such as Goldman Sachs, have the "right" to spend unlimited amounts in political campaigns.
It's also amusing that Pres. Obama turned to Volcker, after basically isolating him from administration discussions aside from occasional photo ops.
It's a complete coincidence that, after Obama44 fought meaningful financial reforms for over a year, that Obama trotted out Volcker right after the "massacre in Massachusetts". Honest.
Volcker's full statement; there are options to enlarge, search and change views:
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