Skip to content

Volcker Rule Begins

Spread the love

Glass-Steagall Signing-Repeal

The banks lobbied hard against re-instituting Glass-Steagall arguing that this would be the end of Commercial and Investment Banking. Why Congress even bought that nonsense one need only pick up the rug and see the amount of donations that were made. Glass-Steagall went into effect is 1934 and was in place until 1999. The commercial banks and investment banks provided a far greater stability to the economy during that period. Ever since, they would rather play with other people’s money and speculate than lend money to small business and create jobs.

Instead of simply restoring Glass-Steagall, we now have the Volcker Rule that simply says the banks cannot engage in proprietary trading with deposit money. However, how is this going to be enforced when the banks own the FIVE agencies that oversee them? When there is a revolving door for government attorneys all looking for those millions jobs, real prosecution is hopeless. Who will actually prosecute a bank criminally when that will be the kiss-of-death for any hope of getting one of those big paying jobs in New York City? No law firm will hire someone who did that for that would jeopardize their ever getting business from the big banks.

The Volcker Rule can be circumvented. They already place money off-balance sheet into subsidiaries to escape reserve requirements. Moving money off-balance sheet is easy and they can then still use it in more clever ways. It would be nice if this ended the problems. But then this is why it is a “rule” that the agencies have to enforce. Good luck!