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facts are as thus far reported, what happened at JPMorgan is proof that the Volcker rule is unworkable and should be repealed. 

On April 13, 2012, the US Department of the Treasury released new cost estimates for the Troubled Asset Relief Program. Looking principally at actual and projected contractual cash flows, the document concludes that: "Overall, the government is now expected to at least break even on its financial stability programs and may realize a positive return." 

Judging by the financial market's renewed unease about Italy and Spain over the past week it would seem that all that the European Central Bank's €1 trillion liquidity injection in the European banking system bought was around four months of relative market calm.

The federal government has taken over large swaths of consumer lending, most notably the $10 trillion home mortgage and $1 trillion student lending markets. The government's share of new loans for each now approaches 100%.Government monopolies in financial services pose risks to taxpayers as well as borrowers

The Federal Housing Administration is supposed to support low-income housing without costing taxpayers a dime. Today, the FHA is subsidizing middle and upper-middle income homes - and setting itself up for a huge taxpayer bailout. 

Under the Dodd-Frank financial-reform law, large nonbank firms may be declared systemically important because their failure will cause a systemic breakdown. In effect, this amounts to a government statement that these firms are too big to fail.

Portugal could avoid Greece's horrible fate if it were to draw the right lessons from the Greek experience.

Fannie Mae did not contribute marginally to the financial crisis. It was the source of the declining mortgage underwriting standards that brought down the system.