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Countries Seek Exemption From Volcker Rule

From an unfazed Reuters:

Canada asks for exemption to Volcker rule

February 13, 2012

OTTAWA (Reuters) – New banking regulations proposed by Washington to avoid bailouts in the future also reach into Canada in a way that could hurt the government bond market and hinder progress on global financial reform, top Canadian officials said on Monday.

In letters to their U.S. counterparts, Bank of Canada Governor Mark Carney and Finance Minister Jim Flaherty said the ban on proprietary trading by banks, known as the Volcker rule, would have unintended consequences for Canada.

These include limiting liquidity in the government debt market and hampering the ability of bank-sponsored mutual funds to provide services to their clients.

"The Volcker rule as drafted would also potentially apply to Canadian banks’ much larger Canadian operations, which pose no risk to U.S. taxpayers or U.S. financial stability," Flaherty wrote in a letter to U.S. Treasury Secretary Timothy Geithner.

"The Volcker rule could apply to transactions between Canadian banks that are simply facilitated by U.S.-based financial infrastructure, such as U.S. clearing houses. This could have unintended adverse consequences for the U.S. financial system," he wrote.

The Volcker rule prohibits banks, which receive federal backstops such as deposit insurance, from trading for their own profit in securities, derivatives and certain other financial instruments. It will also prohibit banks from having more than a minimal ownership interest in hedge funds or private equity firms.

If it is so wonderful, how come Canada wants an exemption?

Both Carney and Flaherty had already expressed their concerns informally and the country’s banking regulator sent formal comments to Washington on December 28.

Complaints are also pouring in from other countries. Last week the European commissioner in charge of financial regulation, Michel Barnier, raised concerns about the rule and Britain’s George Osborne did the same earlier this month.

Carney, who is also chairman of the Group of 20 nations’ Financial Stability Board, said the U.S. legislation as it now stands could reduce the resilience of the global financial system.

Carney proposed two amendments to the legislation on behalf of Canada in his letter to U.S. Federal Reserve Chairman Ben Bernanke.

One change would address a concern that Canadian banks would face restrictions for market-making and hedging activities even if they pose no risk to the U.S. financial system.

Secondly, it suggests that Canadian government securities be exempt from the ban on proprietary trading.

Do these foreigners really think they know more about global finance than Barney Frank, Chris Dodd and Barack Obama?

This article was posted by Steve on Monday, February 13th, 2012. Comments are currently closed.

5 Responses to “Countries Seek Exemption From Volcker Rule”

  1. GetBackJack says:

    Here’s what no “news outlet” will ever tell you.

    And I learned this dealing every day with the City (of London – Google it), being schooled in Follow The Money … (not a pleasant schooling, either, as in “we’re gonna school that boy)

    Western money flows out from Europe, through Scotland to Canada and then into America. Canada acts like a nuclear reactor’s cooling water to our uranium pile of capitalist market domination, while … don’t guffaw … Cuba is the secret back door for the real wealth to move money around the world out of America. Their pop-off valve, in a very real sense.

    The Volcker Rule has provisions in it which allow Regulators here-to-fore unknown access to records, transfer mechanisms and origin-point of money. This makes certain bankers in Canada very nervous.

    Just saying.

    • Chrispbass says:

      GBJ. Not doubting your word. Where can I read about this?

    • GetBackJack says:

      Nowhere. It is the by-product of years working in the strange world of working “finance” outside the mainstream Wall Street paradigm in the and with the City.

      You can get a small taste of how money really works by reading TRADE SECRET by Early van Cleve – see Amazon. A fictionalized account of a truer story, commodity trading markets established by massive warlord drug cartels to repatriate and “legalize” their staggering profits. I highly recommend it.

      Also … and this has my highest possible recommendation … go here …


      I know Catherine. She is 100% the real deal. Every word she’s put to print is dead on accurate.

      Also, it’s the rare person who (a) knows about and (b) recognizes the puppet master reality of the Livery Companies of the City of London


      But the #1 way to understand some of what I stated is postulate why Cuba has been allowed to exist as a protected nest, a protected haven since the 50s, 90 miles off our shores while America went around the world killing communists and overturning governments … but never Cuba. And then Cuba’s cozy enduring relationship with Mexico and their totally corrupt familia patrias and it will only begin to gel once you study how Al Capone virtually owned Mexico and thus Cuba as his private banking empire which then fell to Meyer Lanskey … and the tale goes on.

      ALWAYS follow the money. Money never lies.

      But the origin to my statements lie here …the secret histories of the Opium Wars and the North East Yankee “China Trade” and all the money – bigger than Microsoft and Apple and Google combined – and how to hide it clean it, legitimize it. This led to all manner of strange bedfellows and you know, once a river channel is dug, it is almost impossible to get that river to change course.

  2. mr_bill says:

    I’m sensing a trend here: the nerobama regime comes up with some heinous edict, forces it upon the people or industry, then selectively grants exemptions to friends and those whom it wants to “stay in line.” It’s a lot like having one’s boot on the throat of a political enemy: do what we want or I’ll revoke your exemption.

  3. GetBackJack says:

    Mr. Bill –

    Huey Long said it best, and we should all learn from it How Politicians Operate

    Them what comes in with me now will get a big piece of pie
    Them what comes in with me later will get pie
    Them what don’t come in with me will get good government

    Said another way, Obama’s Plan is to deliver poison into the System then offer those who will work with him the antidote …. so long as they play along.

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