Paul Volcker on the Volcker

Foreign critics should not worry about ‘my’ rule
Financial Times
February 14, 2012
Op-ed by: Paul Volcker, former member of President Obama’s Economic Recovery Advisory Board and a member of the Belfer Center International Council
Topic: Volcker Rule

“I confess total surprise about the complaints by some European and other foreign officials about the restrictions on proprietary trading by American banks embedded in the Dodd-Frank Act – now dubbed the ‘Volcker’ Rule.

It made me think – think all the way back to my years in the US Treasury and Federal Reserve, when the Glass-Steagall Act was in full force. The practical effect was to ban all securities trading by US banks – not just ‘proprietary’ trading, but also ‘market making’ and ‘underwriting’ (except in US government and certain municipal securities). I do not recall – and I am morally certain it never happened – receiving a single complaint that US law was discriminatory, that it damaged other sovereign debt markets or that it limited the ability of foreign governments to access capital markets.”

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