The Volcker rule Research Paper Example | Topics and Well Written Essays - 3000 words

The Volcker rule - Research Paper Example This rule was named after the Chairman of President’s economic recovery advisory board (USA) Paul Volcker. This rule brought stability in the US financial sector by limiting the size of financial institutions by market size. This rule is applicable for deposit taking banks, federally insured, institution owning deposit taking banks. The most important point of this rule is that nation largest bank can’t trade or invest in any property on their whims. According an estimation done by American bankers association it will take 6.6 million hours of work, more 3000 employees and 1.8 million hour per year for implementing this rule. This rule is largely meant for the large banks. All financial experts around the world are not convinced with this model. By virtue of this rule banks can continue underwriting, market making, hedging, insurance company’s activities, trading of Government securities, offering private equity funds and hedge funds. The most important reason fo r choosing this topic is modern world is facing a huge threat from uncertain financial atmosphere around the world. Most of the countries are facing problems to keep their growth rate up. Implications of Volcker rules in the UAE market is the matter of the subject. It will create a system in such a way that, it will prevent unnecessary property trading. This rule would have great implications on the UAE banks which are related with US companies. It would help financial institutions of UAE to avoid taking too many risks in their investments. In this way Volcker rules can be proved to be very helpful in case of insulating the UAE stock market from any financial disasters. It will be an effective proactive step taken by the SCA to control the UAE stock market properly. In this ever changing world, each and every country is related with the other countries