http://online.wsj.com/article/SB125313031639216991.html "Extensive participation in the impersonal, transaction-oriented capital market does not seem to me an intrinsic part of commercial banking," he said in a speech to the Association for Corporate Growth in Los Angeles. Mr. Volcker said banks should be banned from "sponsoring and capitalizing" hedge funds and private-equity firms, which are... [more]
http://online.wsj.com/article/SB125313031639216991.html
"Extensive participation in the impersonal, transaction-oriented capital market does not seem to me an intrinsic part of commercial banking," he said in a speech to the Association for Corporate Growth in Los Angeles.
Mr. Volcker said banks should be banned from "sponsoring and capitalizing" hedge funds and private-equity firms, which are largely unregulated. He also said "particularly strict supervision, with strong capital and collateral requirements, should be directed toward limiting proprietary securities and derivatives trading."
The comments reflect Mr. Volcker's long-held view that banks should act more in line with their traditional role and not take extremely risky gambles, which could threaten the viability of commercial banks and expose the Federal Reserve and taxpayers to large risks. Asked after his speech if his comments represent a break with the White House's proposal, he replied: "Nothing I said today should be a surprise" to the administration.
Mr. Volcker said he would appear before Congress next week to discuss his views in more detail. A Treasury Department spokesman declined to comment.
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Believe me, the Wall Street lobby is working overtime to delay and dilute the impact of even the shallow regulatory reforms currently proposed by Washington. Volcker’s proposal would serve to dramatically change the very nature of how Wall Street operates. I welcome it on a number of fronts, as it would promote economic activity and financial intermediation, including:
1. prioritize extension of credit to Main Street
2. lessen systemic risk on Wall Street
3. dramatically lessen the incestuous nature of the Wall Street-Washington relationship
4. promote much greater transparency in our financial framework
5. level the playing field on our equity exchanges
6. diminish the propensity for insider trading activity on Wall Street
Mr. Volcker takes on the White House and Congress with his proposal. We know Volcker is no favorite of Larry Summers. Knowing the explosiveness of his proposal, Volcker is not bashful in addressing the discomfort his proposal would create for the Washington insiders who are in Wall Street’s pocket
http://www.senseoncents.com/2009/09/volcker-launches-bombshell-on-wall-street-and-washington/
Believe me, the Wall Street lobby is working overtime to delay and dilute the impact of even the shallow regulatory reforms currently proposed by Washington. Volcker’s proposal would serve to dramatically change the very nature of how Wall Street operates. I welcome it on a number of fronts, as it would promote economic activity and financial intermediation, including:
1. prioritize extension of credit to Main Street
2. lessen systemic risk on Wall Street
3. dramatically lessen the incestuous nature of the Wall Street-Washington relationship
4. promote much greater transparency in our financial framework
5. level the playing field on our equity exchanges
6. diminish the propensity for insider trading activity on Wall Street
Mr. Volcker takes on the White House and Congress with his proposal. We know Volcker is no favorite of Larry Summers. Knowing the explosiveness of his proposal, Volcker is not bashful in addressing the discomfort his proposal would create for the Washington insiders who are in Wall Street’s pocket