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With liquidity on the wane, Volcker and Frank defend their rules 

October 21, 2014
Eric Garcia, MarketWatch

As the market sees increased volatility, former Congressman Barney Frank and former Federal Reserve Chairman Paul Volcker responded to critiques that the rules they authored restricted liquidity.

Some hedge fund managers have said higher capital requirements prevented traders ability to cushion declines by buying securities and also blamed the Volcker Rule, which prevents federally-backed banks from speculating on assets like corporate debt.

Last week saw big volatility in the bond market, where low liquidity was blamed, in part, on the moves that included a move as a large as a third of a percentage point in the benchmark 10-year yield.

Read more: MarketWatch

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