The so-called Volcker Rules announced on Tuesday and approved by the five Federal regulatory agencies have already triggered a firestorm, including major references to the need for real reform via Glass-Steagall.

• A Dec. 11 Financial Times editorial titled "A weak hand on casino banking — Volcker rule is justified in principle but flawed in practice," openly calls for Glass-Steagall:

  "But turning a well-intentioned presidential gesture into a workable law has proven to be a fiendishly difficult task," writes the FT. "It took nearly four years for the agencies charged with filling in the details of the so-called Volcker rule to come up with a final draft. Few observers are satisfied with the result... Zealots have argued that... regulators have made so many concessions that the rules will have little effect... It is hardly surprising that they have had difficulty explaining how they will do this in practice. A better way to make banks safer is to ban them from certain kinds of risky activity altogether. This was the approach taken by the repealed Glass-Steagall act, which separated banks from securities firms. While the financial system is now safer than it was four years ago [sic], much work remains to be done. The publication of an ineffective rule should not be mistaken for genuine progress."

• Former Sen. Ted Kaufman headlines in Forbes, "The Volcker Rule Will Not Work," noting, "After nearly four years and countless hours spent negotiating and writing the rule, the five agencies involved have produced one of the great pieces of Swiss cheese in regulatory history — so riddled with exceptions, contradictions, and foggy language that the major celebrants will be the Wall Street lawyers who have been given the Christmas gift of their dreams." After reviewing the history of the Volcker Rule, following the defeat of the bill Kaufman co-sponsored with Cantwell and McCain (Glass-Steagall), and showing that the TBTF banks will cheat and continue proprietary trading under a different name, he concludes, "the tattered remains of the rule Paul Volcker envisioned, as promulgated today, will do very little to stop too-big-to-fail banks from engaging in high-risk trading with FDIC-insured deposits. That will happen only when we establish a strong new Glass-Steagall law that separates commercial and investment banks. The only question is how much damage will be done before that happens."
• Pam Martens, a longtime advocate of Glass-Steagall, writes in wallstreetonparade.com that the Volcker Rules are a sham that "will not take full effect until July 21, 2015." She quotes a press release issued on Dec. 10 by the Board of Governors of the Fed, justifying the delay, citing the need to give banks sufficient time to figure out which of their activities are covered by Volcker Rules, which are barred, and how to implement the new regulations. She follows, "This statement is complete buffoonery. Wall Street firms have known what Section 619 of the law requires since July 21, 2010. Instead of divesting themselves of the improper activities, they've spent their time and shareholders' money fighting the rules." She concludes, "As a few courageous souls in Congress, led by Senator Elizabeth Warren, have realized, the only thing that will bring safety and soundness to the U.S. banking system and orderly financial markets is the restoration of the Glass-Steagall Act."
• Rizza Sta. Ana, writing in Venture Capital Posts, quotes Americans for Financial Reform (AFR) policy director Marcus Stanley warning that if the Volcker Rule fails, this will "redouble pressure to go back and look for something else." AFR is a long-standing backer of a return to Glass-Steagall.
• NYT DealBook by Peter Eavis warns that banks will soon find the loopholes and resume all of the practices that Volcker Rules were supposed to prevent. His column concludes by quoting Sheila Bair that "It might have been easier to restore Glass- Steagall, but there wasn't enough political support for that."
• Bloomberg writes, "Misbegotten Volcker Rule Can Still Do Good," but goes through a long history of Carter Glass, the Pecora Commission, and the original Glass-Steagall. Then it reviews a series of articles from the 1980s that argued that Glass-Steagall failed in its original intention but did succeed in creating a half-century of stable banking. It concludes that the Volcker Rule may be similar, in failing to solve the problem it set out to solve, but doing some good moving forward.
• The Financial Times' Gina Chon writes on Wall Street already preparing to sue over the Volcker Rules. Gibson Dunn is the law firm of choice for Wall Street attacks on regulations, and the top lawyer in the firm is Eugene Scalia, son of the Supreme Court Justice. He has successfully sued regulators on behalf of the Securities Industry and Financial Markets Association, ISDA, and the Chamber of Commerce, to reduce regulations against cross-border derivatives trading and futures speculation on certain commodities. Likely one or several of the industry associations will launch law suits to kill whatever is not loopholed to death in the Volcker Rules. In a separate article, the same author writes that Jack Lew and Acting Deputy Secretary of Treasury Mary Miller rammed through the Volcker Rules over objections by Gary Gensler (CFTC) and Kara Stein (SEC Commissioner), who argued the rules were too weak and had too many loopholes.