US bankers warn reforms will hit eurozone

[alp227]

Source: FT

New curbs for US banks that restrict their ability to trade with their own capital will hit liquidity and demand for eurozone government bond markets at a time when both are in short supply, bankers have warned as they prepare to lobby regulators to water down the rules.

The Volcker rule, passed as part of the Dodd-Frank reform package, will ban proprietary trading by all US banks starting in July 2012. Since the draft regulations came out last month, bankers have been warning that it would hit liquidity from equities to corporate bonds.

But eurozone sovereign bonds have raised particular concerns because US banks have historically played an important role in a market that has seen flows dry up because of worries over spiralling debt and the health of economies such as Italy.

Bankers and traders say that “prop” trading – trading on banks’ own accounts – is a big part of the US presence in the $13,000bn eurozone debt market, but exact figures are hard to come by.

Read more: http://www.ft.com/cms/s/0/cf3bea40-1144-11e1-9d04-00144feabdc0.html

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google the title for full article

[banned from Kos]

1. Dodd-Frank is far stronger than Glass-Steagall -- Democrats need to defend

it and forget G-S.

(and for crying out loud quit pining for it)

[russspeakeasy]

4. How is Dodd-Frank stronger than G-S ?

I'm not being contrary, I just don't see it.

[banned from Kos]

6. its comprehensive

1- makes banks hold adequate reserve capital
2- limits risky investments by banks to 3% of capital (Volcker Rule)
3- makes raters liable for crappy AAA ratings
4- puts credit swaps (derivatives) into an open market
5- sets up consumer protection agency (Warren)
6- sets up liquidation/resolution authority for TBTF banks
7- limits debit card fees

[russspeakeasy]

9. I am under the impression that only #5 is different.

and the rest are subjective. If you know of a site, I'll be glad to check it out....google brings up over 100 k listings....Thanks..

[dipsydoodle]

2. Read as

they're scared.

Rec'd

[russspeakeasy]

3. Read as:

"here's a big fuckin lie we hope you'll believe".

[goforit]

5. What ever the Banks want, do the opposite.... Pass Volcker!!!

[bhikkhu]

10. Its already passed, in the Dodd-Frank Bank Reform Act

Which, as noted upthread, is a very good piece of legislation.

You can read about it here: http://www.pillsburylaw.com/index.cfm?pageid=34&itemid=39752 - which also talks about the 15 month delay in implementing the trading ban, which is just about up. The banks are pushing for an exemption to allow them to continue in European bonds...which might be nice for the Europeans, but its hard to see how our government-insured banks playing with that risk is a good thing.

[jtuck004]

7. Didn't you already play havoc with the Eurozone, tremendous

losses for those that bought into your housing scheme in the early 00s, the blame for which you tried to foist off on the GSE's and the CRA?

NOW you are concerned?

The only thing you, as an industry, have publicly appeared to be concerned about for at least the past decade is your year-end bonus. Any transaction, no matter the consequences and damage to the people and their economies, as long as you can exact a fee. (That's called vigorish by honest people, btw). We cannot limit your income, but we can sure diminish your influence in our elections and our lives.

Maybe it would be in our best interests to keep you at home a little more. It doesn't sound like you play well with others.

[katty]

8. otherwise: yeah, we are scared-now.

[BootinUp]

11. Fook the banksters I say. nt