Fed’s Lacker Says Volcker Rule May Be ‘Impossible’ to Implement
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Federal Reserve Bank of Richmond President Jeffrey Lacker said a U.S. law restricting proprietary trading at banks and scheduled for enactment in July may be “impossible” to implement.
The so-called Volcker rule, named for its original champion, former Fed Chairman Paul Volcker, is aimed at reducing the odds that banks will make risky investments with their own capital and put depositors’ money at risk. Lacker said bank trading books were “kind of tangential” to the financial crisis of 2008-2009, when bank capital was eroded by losses on risky mortgages, many of them bundled into complex securities.