President Obama, with Paul Volcker standing in the background, has just held a press conference to say that going forward the banks will be restrained from using government subsidies to engage in proprietary trading and to sponsor private equity and hedge funds. We will see what comes of this. We will see if Congress rides herd, or tries to obstruct or otherwise water down any proposed legislation. If they do, that may be very unwise politically as elections are coming up and voters, as we saw in MA, are in a lather.
This move is a no brainer, and the fact that Paul Volcker, not Timothy Geithner, and/or Larry Summers, was the only advisor in attendance shaking Obama's hand after his announcement has this citizen more than a little intrigued. After all, the former Fed Chairman, has been, by most accounts, at least to date, a very marginalized figure in the Obama administration. But maybe, just maybe the times are a changing. I remain skeptical, yet hopeful.