Academic

The Volcker Plan

By Gordon Smith, Christine, Hurt, Vic Fleischer, Fred Tung, Lisa Fairfax, David Zaring

If Obama's speech marks a shift in policy - and the jury is still out until the details are deviled up - then there really will have been a change in the way the financial system is regulated.  It will have gone from untaxed, only modestly limited in size, and well on the way to "universal banking" to an industry taxed on bigness, with additional regulatory size limits, and limitations on proprietary trading.

None of this departs much from mainstream economist orthodoxy, and least of the non free market ideologue variant, and you'll note that there still hasn't been the push for compensation regulation that would be unorthodox.  Though I think that getting size limits done by regulation could just as easily be done by punitively limiting compensation of executives at banks deemed too big to fail.

Full post as published by Conglomerate on January 21, 2010 (boomark / email).