HuffPo reports: It will hurt big banks and small banks, foreign banks and domestic banks, state and local governments, big corporations and the poor. It may well make your whites less white and your colors less vibrant.
These are just some of the potential horrors of the so-called Volcker Rule, at least according to months' worth of financial-industry comments to federal regulators implementing the controversial bank reform.
Monday was the last day for the public to comment on the Volcker Rule, which restricts banks' ability to trade with their own money, also known as "proprietary trading." Named for former Federal Reserve Chairman Paul Volcker, the rule is part of the Dodd-Frank financial-reform act and is meant to keep banks from taking big risks that wreck the financial system. Critics say it is a regulation too far and will create more problems than it solves.
Volcker on Monday defended the rule, boiling the criticisms down to a handful of general themes. But the criticisms -- mostly from the banking industry, which has dominated meetings with regulators during the discussion period, HuffPost's Ben Hallman noted last month -- are more varied than that.
For example, some critics suggest the rule will limit the number of people who can trade certain financial instruments, like corporate or municipal bonds. This will lead to the disappearance of what traders call "liquidity," meaning financial instruments will trade more sporadically, possibly increasing volatility and costs (and more lower those hefty Wall Street commissions…)
http://www.huffingtonpost.com/2012/02/13/volcker-rule-wall-street_n_1274796.html?ref=business
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