It appears as though Paul Volcker had something to do with Obama's current proposal. That is a good thing; Volcker's been around the block and knows the games.
Naturally, the Banks will be screeching. Some knee-jerk pundits will, too.
That's fine, IF those critics also think that the Banks should be rescued by the taxpayers and if they wholeheartedly supported TARP.
Under the President's still-sketchy plan, firms that hold government-insured deposits or are eligible to receive cheap loans in an emergency from the Federal Reserve would not be able to trade for their own accounts. The firms could facilitate customer orders as brokers have always done and continue to underwrite new issues of stocks and bonds, but they could not make bets with their own capital or own or invest in hedge funds. ... Mr. Obama has at last joined the most important policy discussion: How to eliminate the moral hazard now embedded in the U.S. financial system. Political assaults on banker compensation have done nothing to address this core problem that enables gargantuan bonuses ---WSJ
Not exactly a re-institution of Glass-Steagall, as some had thought, although some elements are there.
We'll bring more as it comes along.
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