Quantcast
Get breaking news alerts via email

Click here to manage your alerts
How Volcker Rule would limit banks’ risky bets


< Previous Page


A: An event in 2012 may have led regulators to rethink such an exemption. JPMorgan traders in London made huge trades on derivatives with the bank’s money — an ill-conceived bet that cost the bank $6 billion. When the losses came to light, they damaged the bank’s reputation. Experts believe the "London Whale" trades, as they became known, helped speed momentum toward a stricter rule. In its latest form, the rule does not exempt portfolio hedging.

Q: So did the banks end up losing on the rule?

Join the Discussion
Post a Comment

A: Their lobbyists are "hugely influential" in crafting regulations, says Cornelius Hurley, a former counsel to the Federal Reserve who heads Boston University’s Center for Finance, Law and Policy. "But they don’t win every battle."

Q: Will the rule succeed?

A: Hard to know for sure. The final rule requires CEOs of major banks to personally certify once a year that their firms have strong compliance programs. Some big banks have already closed their proprietary trading operations in anticipation of the rule. Still, the rule won’t take effect for the biggest banks until mid-2015 and not until 2016 for big banks below the top tier. Its complexity could make enforcement difficult.

"It’s all in the details," says James Cox, a Duke University expert on financial regulation. "The longer it gets, the more holes it’s got."




Copyright 2014 The Salt Lake Tribune. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Top Reader Comments Read All Comments Post a Comment
Click here to read all comments   Click here to post a comment


About Reader Comments


Reader comments on sltrib.com are the opinions of the writer, not The Salt Lake Tribune. We will delete comments containing obscenities, personal attacks and inappropriate or offensive remarks. Flagrant or repeat violators will be banned. If you see an objectionable comment, please alert us by clicking the arrow on the upper right side of the comment and selecting "Flag comment as inappropriate". If you've recently registered with Disqus or aren't seeing your comments immediately, you may need to verify your email address. To do so, visit disqus.com/account.
See more about comments here.
Staying Connected
Videos
Jobs
Contests and Promotions
  • Search Obituaries
  • Place an Obituary

  • Search Cars
  • Search Homes
  • Search Jobs
  • Search Marketplace
  • Search Legal Notices

  • Other Services
  • Advertise With Us
  • Subscribe to the Newspaper
  • Access your e-Edition
  • Frequently Asked Questions
  • Contact a newsroom staff member
  • Access the Trib Archives
  • Privacy Policy
  • Missing your paper? Need to place your paper on vacation hold? For this and any other subscription related needs, click here or call 801.204.6100.