Sunday, January 22, 2012

Proproety Trading: the Volcker Rule

This piece pulls into question how taxpayers and banks should be interacting. Federal Reserve, Paul Volcker tried to ban propriety trading and "the idea behind banning proprietary trading was to prevent taxpayers from being on the hook for future bailouts of banks that made risky bets solely to chase profits.". although it seems like a smart idea to try to protect taxpayers, Republicans are against the rule because it restricts banks from making bets with their own money. so essentially the rule is taking away their freedom to fail. not only does this rule ultimately diminish constitutional rights, it will also "threaten the United States and its financial markets -- which are the deepest and most liquid in the world". The rule gives the federal government more control over America's economy. therefore this piece could be used to question how much or little say the government should have in the economy. this is relevant to me because in a few years i will have to start paying taxes and deciding how much control i want the government to have in my life.

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