Next week President Obama travels to Wall Street where he'll demand that financial regulations be strengthened and big banks be broken up. I'm kidding. But that would be a smart move -- politically and economically.
The Occupy Wall Street demonstrators are being characterized as to the left on the political spectrum. But there is nothing left-wing about wanting what was for many years seen as a very conservative approach to bank size and risk.
The challenge is how to make our banks and our banking system stronger with the right dose of regulatory medicine. Too little will be ineffectual and too much may produce more complications than benefits.
The Financial Stability Oversight Counsel is releasing an 80 page draft of "recommendations" on the Volcker Rule to the Federal Reserve. But regulators must understand there are two vastly different types of proprietary trading.