New America Foundation Seminar Video: http://www.youtube.com/watch?v=V9TIF1VKHuo
The Volcker rule / Bang or whimper?A much-hyped reform may not have much effect on alternative investors
… the “Volcker rule”, which was designed to __________ banks’ “__________” trading activities (bets made for their own account) and “_________” of hedge funds and private-equity firms.
( firms / proprietary / sponsorship / restrict )
…bankers have worried that they might be _______ to sell their hedge funds and private-equity ______ because politicians consider those _______ too _______.
(risky / units / forced / activities)
Their worst fears seem _________. As The Economist went to press, it looked likely that a _________version of the Volcker rule would pass, allowing banks to keep __________ hedge-fund and private-equity units for clients who want to invest in them, and perhaps to keep putting a small _______ of their own ___________ in them as well.
( share / unfounded / capital / running / diluted)
Dodd-Frank Bill's Volcker Rule a Win for Big Banks
… revised ____ of the Volcker rule was passed by Congress, watered down significantly from its original conception. It allows banks to invest _____3% of their tier 1 capital in private equity and hedge funds, but they cannot own more than a 3% ownership ______ in any private equity group or hedge fund. The 3% capital _____is a big enough _______that most big banks won't have to curb their proprietary trading much, if at all.
(stake / version / threshold / loophole / up to / curb )
Here's a chart showing Tier 1 and 3% of that for five major banks:
(shedding / generates / magnitude / awful / largely)
The Banking Act of 1933 was a law that ________ the Federal Deposit Insurance Corporation (FDIC) in the United States and introduced banking reforms, some of which were designed to control speculation. It is most commonly known as the Glass–Steagall Act, after its legislative sponsors, Carter Glass and Henry B. Steagall.
Some provisions of the Act, such as Regulation Q, which allowed the Federal Reserve to _________ interest rates in savings accounts, were ___________by the Depository Institutions Deregulation and Monetary Control Act of 1980. Provisions that prohibit a bank holding company from owning other financial companies were ____________ on November 12, 1999, by the Gramm–Leach–Bliley Act.
The repeal of the Glass–Steagall Act of 1933 effectively removed the separation that previously existed between Wall Street investment banks and _________ banks and has been blamed by some for exacerbating the damage caused by the collapse of the subprime mortgage market that led to the Financial crisis of 2007–2010. The potential to make enormous profits trading mortgage-backed securities with artificially high _________ encouraged banks to take on __________ intolerable risk in the form of bad loans.
(repealed / repealed / ratings / depository / established / otherwise / regulate)