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Now that the Dodd-Frank bill is law how will -- be put into action we got a couple years to we're gonna know the full impact.
But Paul Volcker would like something's gone.
Senior correspondent Charlie Gasparino going inside mr.
Volcker head and find out what he would probably nobody wants to do which is.
Not exactly begins -- on the Big -- -- bust up trading well -- and banking well not.
Really I mean this in the it was an.
I did not get in the -- had full disclosure laws might sources or analyst.
-- recently spoke to Paul -- the -- financial -- Who wrote that and I spoke to him on -- -- that I just read you're saying is wrong and if it was wrong.
That you weren't satisfied that you're so I -- I should try -- has been fight and we're gonna follow the wedding for you that's right whatever.
Have I don't know what just happened at that event might what do you got sore yesterday -- this -- this is a flashback from another time.
But -- sources of mine who spoke with Paul Volcker -- presidential advisor former Fed Chairman.
Say he is making the rounds trying to essentially explain how he thinks financial reform should work and what's really fascinating about -- Is that he -- is no words when he's what he's saying is that the US -- as opposed to some of the European -- -- Basil too.
And -- regulation which he considered according to one analyst to elegant.
This new this law particularly.
His -- ruled the Volcker Rule designed to curb proprietary trading and other is taking is the necessary blunt quote unquote blunt instrument.
That is needed in the markets to to reduce risk which he is envisioning and this is what he's telling people.
By putting these sort of fairly significant controls on risk at least that's what he says remember there's no more for proprietary trading.
Banks can't -- you put their money at risk in hedge funds and private equity more than 3% of their -- money.
It's it's pretty if you want if your bank you cannot really do too much of risk your own capital trading in the market he's saying that this will force.
CEOs all these rules put together higher capital Stan is gonna force it's -- -- sort of top.
Down regulation inside the banks where you have for example a CEO of Morgan Stanley.
Who actually goes to a trader.
And he's trading desk and -- peppering him with questions about positions.
You hold of you -- are how long have you held this position for why you holding it for three days he's basically saying that that's the type.
Of of internal compliance that was missing.
-- the bubble years and let the financial crisis so bye bye basically forcing stringent I guess reductions are proprietary trading by forcing banks hold more capital.
And also by forcing banks -- not really get get -- only in private equity and hedge funds.
You have this sort of top down management which takes that takes -- risk taking through what he believes is a blunt instrument I don't necessarily agree with that.
I think this do a lot is a lot is a Rube Goldberg esque.
So quality to this this financial regulation although the vocal rule is -- the one part of the -- rule is pretty clear but -- least that's what Paul Volcker is telling.
-- -- -- -- -- Are saying he would rather have you know a two page bill that just very clearly lay this out that -- 2000 page bill could use the term.
Elegant -- I guess came from Volcker but elegant I would assume in this case doesn't mean.
Good he probably don't know it's too broad it's too much.
I think iPhone when I'm talking to analyst.
This in both Paul -- -- right you're actually right Paul Volcker made a pretty simple rules is rules are pretty simple you.
You can't do proprietary trading anymore.
If your bank in the -- all the all the investment banks are considered commercial banks essentially and you know you're restricted in terms of roll the dice -- hedge funds and private equity that's it.
That's a pretty simple Heidi I war you know the impression that I get from talking to the -- -- -- -- -- -- he still believes that there is that this that this bill while it takes us in that -- blunt direction.
He's still pretty elegant and of itself I mean you have to realize it's 2500.
-- Of rules regulations consumer agencies there's a lot of moving parts here there is a Rube Goldberg esque quality to this thing didn't -- to roll over the BBC -- a rule in this law that requires companies to detail how many commodities they are using in products that were sourced from the Congo right now is really an insane thing.
Listen like I said.
Heat he's most proud of -- least according to people that spoke with them recently.
About the fact that his rule even though it is somewhat watered down from what initially was.
His rule is pretty straight forward.
The impression that these these analysts -- -- from speaking with him that he uses the rest of the bills like that he believes that there's no way to regulate Wall Street except for with a hammer.
And if you wanted to stop taking risk.
Which is -- to everybody is right now.
Even though you note you know that there is a degree of risk and everything that Wall Street does that's just part of the market.
If you want the excessive risk taking that we've got out he got a hammer me he thinks the ball rule is a step in that direction.
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