Barclays' Varley Not Impressed By Volcker Rule

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The Brits are jumping on the Volcker Rule-hating bandwagon, because a) the rule is stupid, b) it'll make them lose a boatload of money, and c) screw you US, (Obama, Timmy, Paul) if you think you can just go at it alone. Barclays' CEO John "profits are not satanic" Varley said that the proposal was "completely irrelevant" and that the idea of breaking big banks was just dumb as "size is irrelevant."

I don't think something simplistic like prohibiting proprietary trading in banking is the answer.

Varley, who's getting more irritated by the week, would also like to remind people that he never asked anyone - and certainly not the FSA- the permission to buy Lehman. So he doesn't really see the point of responding to anyone now, especially since Barclays is the best bank ever.

I never asked Mr. Sants [FSA CEO Hector Sants, who by the way, announced his resignation today] for his consent to proceed.

Team Barclays is getting mad, and we understand. As president Robert Diamond pointed out in Davos, the bank is "immensely proud" that the bank didn't take any direct money from any government anywhere in the world.

"I think that what goes unnoticed is that the banks which stayed strong and were well managed through this are angry at the banks (that) had poor management (and) were allowed to have poor management and ineffective regulations," Diamond said.

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The Volcker Rule Will Come Too Late For Kaufman Bros.

If you're a more or less regular consumer of efficient markets hypothesis Kool-Aid then a fun activity is to handicap the probability of various public policy things based on market reaction.* So for instance Obama's budget is going to reduce the tax deductibility of munis! And the muni market didn't care! So, no, Obama is not going to reduce the tax deductibility of munis. You heard it here first, or last, or whatever. (Exercise for the reader: is Obama going to raise the tax rate on dividends?) Since today seems to be Volcker Day hangover it's worth pondering this: