{"id":5550,"date":"2013-12-17T00:00:00","date_gmt":"2013-12-17T06:00:00","guid":{"rendered":"https:\/\/institutionalinvestorsecuritiesblog.blawgcloud.com\/2013\/12\/volcker_rule_already_affecting"},"modified":"2022-05-05T11:51:55","modified_gmt":"2022-05-05T16:51:55","slug":"volcker-rule-already-affecting","status":"publish","type":"post","link":"https:\/\/www.investorlawyers.com\/blog\/volcker-rule-already-affecting\/","title":{"rendered":"The Volcker Rule May Already Be Affecting Financial Markets & The Economy"},"content":{"rendered":"

According to The Wall Street Journal<\/em>, it\u2019s just been a week since regulators approved the Volcker Rule and already investors and financial institutions are looking for new ways to finance municipal bond investments<\/a>. The Volcker rule limits how much risk federally insured depository institutions can take, prohibiting proprietary trading, setting up obstacles for banks that take part in market timing, and tightening up on compensation agreements that used to serve as incentive for high-risk trading.<\/p>\n

Now, says Forbes,<\/em> Wall Street and its firms are undoubtedly trying to figure out how to get around the rule via loopholes, exemptions, new ways of interpreting the rule, etc. (One reason for this may be that how much executives are paid is dependent upon the amount they make from speculative trading.) The publication says that banks are worried that the Volcker Rule could cost them billions of dollars.<\/p>\n

For example, with tender-option bond transactions, hedge funds, banks, and others employ short-terming borrowings to pay for long-term muni bonds. The intention is to make money off of the difference in interest they pay lenders and what they make on the bonds. While tender-option bonds make up just a small section of the $3.7 trillion muni debt market, it includes debt that has been popular with Eaton Vance (EV), Oppenheimer Funds<\/a>, and others.<\/p>\n

Continue Reading \u203a<\/a><\/div>\n","protected":false},"excerpt":{"rendered":"

According to The Wall Street Journal, it\u2019s just been a week since regulators approved the Volcker Rule and already investors and financial institutions are looking for new ways to finance municipal bond investments. The Volcker rule limits how much risk federally insured depository institutions can take, prohibiting proprietary trading, setting up obstacles for banks that […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[3752,3740],"tags":[2540],"class_list":["post-5550","post","type-post","status-publish","format-standard","hentry","category-financial-firms","category-miscellaneous","tag-volcker-rule"],"yoast_head":"\nThe Volcker Rule May Already Be Affecting Financial Markets & The Economy — Investor Lawyers Blog — December 17, 2013<\/title>\n<meta name=\"description\" content=\"According to The Wall Street Journal, it\u2019s just been a week since regulators approved the Volcker Rule and already investors and financial institutions — December 17, 2013\" \/>\n<meta name=\"robots\" content=\"index, follow, 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