December 10, 2013
This is Mark Vickery covering for Sheraz Mian, who will be away
on business until later this week.
Never mind Janet Yellen right now -- Treasury Secretary from at
least a generation ago Paul Volcker is now front and center in
business news this week. The reason? Apparently, he's considered by
some to have the best system for regulating the finance industry
going forward. I'm sure it helps his position that he's an advisor
of President Obama.
While the "too big to fail" banks like
Bank of America
) are busy settling lawsuits regarding various mismanagement of
funds largely having to do with the mortgage crisis that collapsed
the U.S. economy 5 years ago, five federal agencies are reportedly
planning to approve a strict version of the Volcker Rule next week.
The plan includes trading bans for banks and limiting their hedge
fund investment capabilities.
Next week, these five commissions -- including the SEC and others
you likely have never heard of unless you're a banker -- have
announced they will vote on the Volcker Rule, meaning it stands a
good chance of passing. The Volcker Rule was actually included in
the larger Dodd-Frank legislation of a few years ago, and the
Volcker Rule itself is supposedly close to 1000 pages long.
So while free-marketers will lament and wring their hands over what
restricting banks from taking investment risks will do to our
economy, it's still possible to look at this event as possible good
news, even if you hate the policy: knowing what the damage is going
to be, and planning accordingly because of it, is better than not
knowing. More unfinished business before calendar 2013 comes to a
Such is life when the only other news this morning is that
) is switching CEOs and
) beat earnings on what are comparably paltry revenue numbers year
Zacks Director of Research Sheraz Mian will be back this week.
He'll likely find more interesting things to discuss, and in a more
insightful way, so please don't despair.
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