U.S. lawmakers and interest groups favoring tighter restrictionson proprietary trading said JPMorgan Chase & Co.'s $2 billionloss on synthetic credit securities bolsters their case.
Senator Carl Levin, the co-author of the so-called Volcker ruleand chairman of the Permanent Subcommittee on Investigations, saidthe New York-based bank's disclosure yesterday served as a “starkreminder” to regulators drafting the proprietary-trading banrequired by the 2010 Dodd-Frank Act.
“The enormous loss JPMorgan announced today is just the latestevidence that what banks call 'hedges' are often risky bets thatso-called 'too-big-to-fail' banks have no business making,” Levin,a Michigan Democrat, said in a statement.
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