Also in this playlist...
This transcript is automatically generated
Paul Volcker the former Federal Reserve chair under Ronald Reagan talked today about how long it might be before the Volcker Rule.
Listen to what he said.
Street here for -- horses.
I hope we go through -- reform of -- on a version.
Would you even.
Years later he's right I mean Charlie it's taken a long time but now he's speaking about this and what Ben Bernanke is doing some active some -- -- -- you know 4040 years after he tamed inflation stagflation -- Well inflation to back in 1980.
Still important he became president Obama's economic advisors crowd following the financial crisis.
He was one of the guys who advised Obama as to what to put into Dodd-Frank the major financial reform law.
They came after that to 2008 banking crash one of the Unix inside Dodd-Frank.
He's known as the Volcker Rule.
They never had.
It's supposed to in what's known as proprietary trading that means a bank that goes out and risks its own capital in the markets by trading.
Lot of people say that was one of these sort of reasons why we had a financial meltdown I would say that is not the case would not argue that -- bottom line is.
It's in Dodd-Frank blocked that he is -- huge but.
And I believe and I -- -- and this is his fault vocalist wolf.
It is not been implemented three years after the -- out apocryphal eh here's why because he wrote it in such an obtuse way.
It was included in the -- in such an obtuse way.
That bill could figure out exactly what it means does it really mean that you as a bank can't risk your capital which a lot of banks have no problem -- Yet we don't have to restore capital but does -- mean that you as a bank cannot make a legitimate market for your customer IE.
Customer fidelity calls up and says -- -- week I might need some Japanese yen.
You go out there by some -- put you put it on about use of your balance sheet that's pulled Markovic I don't -- about -- if you don't do that.
We don't have we don't have liquid markets in the United -- the vocal rule in its strictest sense.
Outlaws that now right now we should point out.
That the SEC and the Federal Reserve -- squabbling over the meaning of this rule.
We should point out that -- knew that this regulatory boy he -- it is best described as a regulatory void the banks are making up to interpretation on their own.
There is very little proprietary trading.
There is market making and then there's stuff that blends in between I can see where a market making opportunity could be -- proprietary trade by the way.
You wanna buy yen -- -- -- a little more yet because I think you know you need to -- to little -- and I make a little bit on the difference.
That's why this is such an insane law.
Rule whatever edict -- that's -- no -- figure it out.
Is because all this stuff is great okay this is very difficult to tell banks not to do something but do something else there is no clear line.
-- -- -- -- -- -- -- -- -- -- It you know adding insult to injury was before some sort of I think was before the senate banking committee I have to check this exactly where he was.
Because senate banking committee and he likened.
Trying to figure out what it what is a good proprietary trade.
Or being a proprietary trade -- a good one on behalf of customers as pornography you know you know when you see it.
That's what I heard if they go the report out task is an 85 real -- he started.
Apartheid in nineteen it's kind of creepy but in any event.
We should while -- that we should point out that he does he talk about pornography -- -- he does.
He talks about how album that you got a wealth it's these talks about how stock and company you know.
It's company paperwork that he loves to read a brief that like you put -- Playboy.
He says he reads Playboy now he says he reads -- company's year end results and things like that such a disgusting visage.
Well -- -- -- what -- look at it yeah are you flexing her muscle the other day I guarantee you that is viewers.
Did you you think it's you would grab the lead at -- -- look at that Playboy and before -- -- so if a are you saying he's just.
There -- reports like they were Playboy.
That's a little weird to it we'll hear what's interest to him.
Paul Volcker as she tries to shift back to Paul -- -- talking about the Federal Reserve and Ben Bernanke and saying that Q week.
Is now losing it's effectiveness -- you like to finding everything watching the final curious.
Quantitative easing as large scale asset purchases 85 billion a month to prop up the markets -- printing money.
Abide by saying what I write letting -- drive nine facets of the bank's balance sheet which therefore infuses them with cash.
What's your point but my point is that that he is now saying that the effectiveness is wearing off tell us something we don't know yet but the big the big question in the market right now -- market's been up and down all the time on whether.
This CEO Ben Bernanke knows it's ineffective this is where it off and maybe there's more harm than good -- that he's gonna soon.
Stop the printing money I will tell you this most people think they're gonna keep -- to the end of the year.
-- -- can -- -- as well that's true that is the one thing everybody out there -- to watch because when they stopped.
The signal the -- that they stopped that market going down big time.
Sponsored gonna -- assists that's pretty crazy to because -- a bubble bonds have a lot of people went into bonds so let's just say the Fed stops.
-- that means the prices go down yields go up but prices go down as a lot of people in bonds right now so this could have hemorrhaging affects.
On two bubbles that have been after the -- involves the stock market which is a bubble.
And the bond market which is a big bubbles well.
Charlie Gasparino thank you very much.
And your point is.
Filter by section