Tuesday, January 26, 2010

Will Paul Volcker Tell Congress What the Volcker Rule Is?

As John Carney has pointed out, no one really knows what the Volcker Rule is, though somehow it appears to be the key to understanding what the impact of the new financial regulations will be.

Perhaps the man himself will tell us. He is going to have the opportunity.

The Senate Banking committee is expected to have a hearing Tuesday, Feb. 2, to hear from former Federal Reserve Chairman Volcker about the White House’s recent proposal to limit the size and risk of big U.S. banks.

The very tied in Nouriel Roubini seems to think the Volcker Rule is about splitting up the big banks. If so, that would mean Goldman Sachs may suffer a huge division between their trading apparatus and the cheap Fed money they have access to at the present time.

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