NEW YORK (TheStreet) -- It's time for Congress to provide more guidance to bank regulators on exactly what kind of hedging activity will be permitted by banks, in the wake of JPMorgan Chase's (JPM) $2 billion trading loss announced last week.
JPMorgan's $2 billion loss on hedging trades -- announced by CEO James Dimon last Thursday -- is "a potential opportunity for the policy makers to conduct a public hearing to really understand exactly what went wrong here," according to Frank A. Mayer, -- a partner in the Financial Services Practice Group of Pepper Hamilton LLP -- who adds that "you don't want to make policy based on myth."
At issue is the Volcker Rule, which the Federal Reserve is still struggling to implement, nearly two years after the Dodd-Frank Wall Street Reform and Consumer Protection Act was passed. The Volcker Rule prohibits bank holding companies from engaging in most forms of proprietary trading while severely limiting banks' investments in private equity funds and hedge funds. The Federal Reserve has had difficulty in defining which hedging activities banks will be allowed to continue engaging in.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV