Intended and Unintended Results of the Proposed Volcker Rule

Alida S. Skold

MPRA Paper from University Library of Munich, Germany

Abstract: Regulation is written with the intent of protecting the vulnerable. However, it can cause an undesirable result if written without understanding how the positive intent can have a negative impact. In its present form, the proposed Volcker Rule has the potential of expanding the liquidity crisis that devastated the housing market into the capital markets. Risk will be transferred to less regulated entities. Banks conducting business in the U.S. or with U.S. “residents” will be at a competitive disadvantage.

Keywords: Volcker Rule; Regulation; Prop Trading; Market Making; Hedge Fund; Risk (search for similar items in EconPapers)
JEL-codes: D02 D78 E02 G38 L50 (search for similar items in EconPapers)
Date: 2011-11-12
New Economics Papers: this item is included in nep-reg and nep-rmg
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https://mpra.ub.uni-muenchen.de/50103/1/MPRA_paper_50103.pdf revised version (application/pdf)

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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:34672

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