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Volcker Rule

The Volcker Rule, which is part of the http://www.babypips.com/blogs/espipionage/the-dodd-act-law-and-its-possible-effects-on-forex.html enacted in 2012, imposes limits on proprietary trading by commercial banks.

The Volcker Rule aims to prevent banks from using their own funds to make speculative bets in the markets. This way, the banks’ losses on their trades won’t directly restrict their ability to lend to consumers and businesses.

According to the rule’s proponent and former http://www.babypips.com/forexpedia/Federal_Reserve chairman, Paul Volcker, this trading activity is partly to blame for the 2008 financial crisis.

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