FOR IMMEDIATE RELEASE
Wednesday, May 30, 2018
Contact: Nick Jacobs, 202-618-6430 or njacobs@bettermarkets.com
Washington, D.C. – Dennis Kelleher, president and CEO of Better Markets, issued this statement following the release of proposed changes to the Volcker Rule:
“The Volcker Rule bans taxpayer backed banks from dangerous, destabilizing, high-risk and socially useless gambling called proprietary trading. It’s one of the most important financial reforms enacted in the wake of the devastating 2008 financial crisis, but Wall Street’s biggest banks have fought to weaken or kill it from the start because it reduced their bonuses.
“One of the biggest unacknowledged benefits of the Volcker Rule’s ban on proprietary trading is that it forced banks to shift from bonus-boosting but reckless short-term trading to socially useful lending to the real economy. That financial activity is why taxpayers back banks in the first place: to support and enable economic growth that creates jobs and prosperity. The Volcker Rule has been proved to be wildly successful as banks’ revenues and profits from lending have soared while trading activity has dramatically decreased.
“The Volcker Rule has also dampened the destabilizing, reckless, socially useless trading culture that had infected our largest financial institutions. Gambling and a gambling culture have no place in the country’s biggest banks that are backed by taxpayers, who lost jobs, homes and savings but still had to bail Wall Street out of its losing bets just ten years ago.
“All those gains for taxpayers and the country are needlessly being put at risk when there is no evidence that the Volcker Rule has had any negative effect on financial activities related to the real economy. Given the irresistible riches generated by proprietary trading, it is inevitable that weakening the Volcker Rule will result in banks again pushing the envelope, gaming the system and ramping up their dangerous trading.”
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Better Markets is a non-profit, non-partisan, and independent organization founded in the wake of the 2008 financial crisis to promote the public interest in the financial markets, support the financial reform of Wall Street and make our financial system work for all Americans again. Better Markets works with allies – including many in finance – to promote pro-market, pro-business and pro-growth policies that help build a stronger, safer financial system that protects and promotes Americans’ jobs, savings, retirements and more. To learn more, visit www.bettermarkets.com.
