Will restricting proprietary trading and stricter derivatives regulation make the US financial system more stable?

Two of the major provisions of the Dodd?Frank Wall Street Reform and Consumer Protection Act, passed into law on July 21 2010, aim to reduce speculation with financial institutions own funds using highly leveraged derivatives. The so?called "Volcker rule" limits the ability to trade as pri...

Full description

Saved in:
Bibliographic Details
Published in:PSL quarterly review 2011-01, Vol.64 (258), p.227-247
Main Author: Kregel, Jan
Format: Article
Language:English
Subjects:
Bank acquisitions & mergers
Bank holding companies
Bank regulation
Banking industry
Capital markets
Deposit insurance
Derivatives
Dodd‐Frank
Equity
Equity funds
Financial institutions
Financial reforms
Financial regulation
Financial speculation
International finance
Investment banking
Lincoln Amendment
naked CDS
Proprietary
Proprietary trading
Provisions
Regulation of financial institutions
Securities markets
Stockholders
U.S.A
Volcker Rule
Wall Street Reform & Consumer Protection Act 2010-US
Online Access:Get full text
Tags: Add Tag
No Tags, Be the first to tag this record!
Description
Summary:Two of the major provisions of the Dodd?Frank Wall Street Reform and Consumer Protection Act, passed into law on July 21 2010, aim to reduce speculation with financial institutions own funds using highly leveraged derivatives. The so?called "Volcker rule" limits the ability to trade as principal in what is known as "proprietary trading" and the Lincoln Amendment or the "push out" rule limits derivatives dealing for regulated, insured banks. A complement to the Lincoln amendment requires that all over the counter derivatives be cleared through official mechanisms and traded on regulated exchanges similar to those used for commodities. Keywords: financial regulation, naked CDS, Volcker Rule, Dodd?Frank, Lincoln Amendment. JEL Classification: E11, G01, B50, H12.
ISSN:2037-3635
2037-3643
2037-3643
DOI:10.13133/2037-3643/9410