In last week’s Insights & Indictments, in my commentary on all the letters sent to the SEC about the proposed Volcker Rule, I not-so-casually commented that the Volcker Rule “shouldn’t exist at all.”
And then I called the parents of the Volcker Rule, the Dodd-Frank Act, a “joke.”
Well, by the amount of comments I got back from I&I readers – right now, there are about 95,000 of you (and counting) – you’d think I was talking about something really controversial, like contraception, for heaven’s sake.
Talk about passionate!
I understand that people get passionate about contraception. After all, without all that passion, we wouldn’t need contraception.
But me being passionate about the birth of the Volcker Rule, which I said should never had been conceived, apparently caused a lot of you to think I crossed some moral line.
Not me! I’m not one to ever say anything controversial! And I’m certainly not the kind of guy to wade into the contraception debate.
But, if I was, I’d be a strong advocate for it.
The unwelcome birth of the Volcker Rule is a good example…
If the inflamed passion of those two preening peacocks, Chris Dodd and Barney Frank, was sheathed before their love of public attention (and private whoring to special interests) forced them into the “Act” (I’m talking about the Dodd-Frank Act; get your mind out of the gutter), then we wouldn’t have this the bastard-child whose future we are debating.
Actually, though, it’s not that we have the Volcker Rule that’s an issue. It’s the affair between its parents that’s the issue.
There was no happy marriage in Dodd-Frank. It was always a sham.
The Act itself isn’t a marriage certificate, proving a passionate love for the public interest over private banking and financial services.
It’s nothing less than a living will pre-nup that guarantees infidelity everywhere between the sheets it’s dirtied in its making.
By “sheets,” I mean sheets of paper. Dodd-Frank is 848 pages long.
By comparison, it is 23 times longer than the 37-page Glass-Steagall Act, the sensible 1930s legislation that separated deposit-insured commercial banks from risk-taking investment banks and was aborted by Congress in 1999.
Don’t get me started on that…!
All I’ll say is that Dodd-Frank is really an attempt to put Humpty Dumpty (Glass-Steagall) back together again, with the biggest pieces missing.
Just How Ridiculous is Dodd-Frank?
It’s not legislation. It’s not a passion play. It’s a comedy.
It mandates 87 “studies,” of which only 37 have been “completed.”
I just read in The Economist that, according to super-powerhouse law firm Davis Polk (believe me, they are good!), “only 93 of the 400 rulemaking requirements mandated by Dodd-Frank have been finalized.”
If you don’t understand the significance of enacted legislation that isn’t yet written, the Volcker Rule is a perfect example.
The Volcker Rule is a part of Dud-Frankenstein (I mean Dodd Frank, or D-F, as in…). And it, alone, is some 298 pages (or dirty “sheets”) long.
It was written by four of the five agencies charged with writing and enacting it. The fifth agency, the CFTC, wrote its own 489-page proposal on what should be in the Volcker Rule.
Good thing all our regulatory agencies all work together, right? Good thing they don’t all have their own fiefdoms and competing political agendas, right?
Anyway, Davis Polk says that the Volcker Rule includes 383 questions that themselves result in 1,420 sub-questions. The firm has created an interactive Volcker “rule map” that, according to the magazine, it produced for its clients – as well as 355 “distinct steps” for them to follow.
So, I ask you, this bad marriage, this sham affair, this monster Dud-Frankenstein that birthed the Volcker Rule, or son-of-DF…
Is this any way to legislate?
The Whole Exercise is Another Form of “Extend and Pretend”
Last week, when commenting on the Volcker Rule, I called President Obama “spineless.”
A lot of you didn’t like that either. (Of course, some of you loved it.)
What I was pointing to was that the President came into power with an OVERWHELMING American mandate (and a global mandate, for that matter) to clean up Wall Street and to protect us from what had just happened, ever happening again.
So did he take immediate action upon entering office? No.
Instead of striking while the iron was hot, the President pandered to Wall Street special interests (after all, he had accepted tens of millions of dollars from them in election funds) by pretending to attack banks and bankers, all the while extending the day of reckoning and the writing (if you can call it that) of any legislation to stomp out Wall Street abuses.
And lo and behold, we got Dodd-Frank.
We got shafted.
So today we get to pretend that laws were written (most were not, and never will be, and the ones that are written, like the Volcker Rule, well, you see what’s happening there), while banksters get to extend the time it takes to enact anything meaningful just long enough to get markets to reach new highs and the focus of discussion shifts from what Wall Street hath wrought, to contraception.
So go ahead, get mad at me for bringing up contraception. After all, can’t you see that I’m just trying to divert the conversation?
P.S. At overwhelming request from you guys, we’re now going to have “share” buttons attached to every I&I article. You can find them along the left side of each article on the website, or at the bottom of each email. Whether it’s email, Facebook, Twitter, or anything else, I encourage you to “share” to your heart’s content.