Dodd Reverses Course, "Strongly Supports" Volcker Rule, Goldman Shares Slump
In a seeming reversal of yesterday's FT rumors that Chris Dodd would do everything in his power to undermine the passage of the Volcker rule, as part of his prepared remarks at today's hearing on high-risk investment activities by banks, Dodd said that he "strongly supports" a proposal to restrict large commercial banks from engaging in significant proprietary trading or owning hedge funds or private equity arms.
"These proposals were borne out of fear that a failure to act would leave us vulnerable to another crisis, and of frustration at the refusal of financial firms to rein in their reckless behavior."
However, since Dodd is well known for diametrically changing his opinion depending on what camera angle he is being filmed from at any given moment, we will wait to reserve judgment on Dodd's schizophrenic approach to policymaking at this point.
In the meantime, however, Goldman Sachs stock is not too happy about this development.