volcker plan

It took them a while to react, but central bankers are beginning to voice their approval of US plans to limit bank trading, aka the ‘Volcker plan’.

Yesterday Mervyn King voiced his approval, saying that, thanks to Mr Obama’s plan, ‘radical reform’ was at last on the table. He qualified his support by saying any measures should be part of a ‘major structural change’; one proposal alone would not solve the problem. 

There is more support for a US-style levy than for a tax on transactions. So says Bank of England governor Mervyn King, who has welcomed President Obama’s proposal to overhaul the banking sector, the ‘Volcker plan‘.

In a Commons hearing on the “too big to fail” debate, Mr King said: “The proposals made it very clear that radical reform is on the table. One way or another we have to reform the financial system,” he added, cautioning that “not one proposal will solve all problems”. 

Worth reading both The Economist piece, and Clive Crook’s reaction to it. Gems include:

On nomenclature: