The $2 billion loss at JPMorgan Chase (JPM) has reopened debate on the Volcker rule. The proponents of the rule have seized on the story as proof that the Volcker rule is necessary and should be quickly put into effect by regulation. In reality, however, if the facts are as thus far reported, what happened at JPMorgan is proof that the Volcker rule is unworkable and should be repealed. 

It’s depressing to watch, but it is missing the point that the Volcker rule would not have prevented the loss and is probably unworkable.

During two closed sessions before the luncheon, committee members discussed the latest in financial regulation issues. At a luncheon briefing following these sessions, SFRC members gave several statements and answered questions.

The Shadow Committee congratulates federal policy makers for not providing direct financial support to assist in the resolution of Lehman Brothers.The Committee believes it is important not to rush to judgment on the need for intervention in many cases, or on the inevitability of tightened Fed regulation of investment banking. 

The Shadow Financial Regulatory Committee (SFRC) is a group of publicly recognized independent experts on the financial services industry--including banking, insurance and securities--who meet regularly to study and critique regulatory policies affecting this sector of the economy.

Far from requiring greater government oversight, U.S. banking"s woes have been the product of regulation.

The Shadow Financial Regulatory Committee (SFRC) is a group of publicly recognized independent experts on the financial services industry—including banking, insurance and securities—who meet regularly to study and critique regulatory policies affecting this sector of the economy.

Last year's repeal of the final remaining vestige of Regulation Q, the prohibition of payment of interest on business demand deposits, at long last completed a pro-competitive process which began with the Monetary Control Act of 1980.  The repeal was and is a good idea.  We can easily see this by asking and answering half a dozen simple questions, to make the matter clear.