The Impact of the Volcker Rule on Job Creators
Testimony submitted to the House Financial Services Committee hearing on "The Impact of the Volcker Rule on Job Creators, Part I"
Sound principles lie behind the "Volcker Rule" (section 619 of the Dodd-Frank Wall Street Reform and Consumer Protection Act; P.L. 111–203). Very large banks in the United States are perceived as "too big to fail," because their potential distress and failure would likely cause massive damage to the rest of the financial system. As a result, the downside risks created by these institutions are borne, in part, by the government and the Federal Reserve—as a way to protect the rest of the economy.