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Shortly after Jamie Dimon's appearance on Fox last month, PBS's Bill Moyers had former Chairman of the Board of Governors of the Federal Reserve System and head of President Obama’s Economic Recovery Advisory Board, Paul Volcker, whose namesake is the Volcker rule that Wall Street has been lobbying so hard to water down or get rid of, as his guest.

In light of the recent debacle at JPMorgan Chase where Dimon's company lost at least $2 billion on high risk derivatives trading, his advice for Dimon during this interview is downright prescient; If you want to participate in proprietary trading, give up your banking license.

Paul Volcker on the Volcker Rule:

You’d think after such a calamitous economic fall, there’d be a strong consensus on reinforcing the protections that keep us out of harm’s way. But in some powerful corners, the opposite is happening. Business and political forces, including hordes of lobbyists, are working hard to diminish or destroy these protections. One of the biggest bull’s-eyes is on the Volcker Rule, a section of the Dodd-Frank Act that aims to keep the banks in which you deposit your money from gambling it on their own — sometimes risky — investments. [...]

Volcker contends the rule aims to curb conflicts of interest between bankers and their customers. He suggests that former investment companies like Goldman Sachs and Morgan Stanley, which sought banking licenses during the economic crisis in order to access federal protection against failing, should now turn in those licenses if they want to do speculative trading.

“You shouldn’t run a financial system on the expectation of government support. We’re supposed to be a free enterprise system,” Volcker tells Moyers. “The problem of course is once they get rescued, does that lead to the conclusion they’ll get rescued in the future?”

Transcript of the clip below the fold and you can watch the entire interview at the link above.

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Jon Perr explained how awful this so-called JOBS Act, or "Jumpstart Our Small Business Startups" is that was being pushed by Eric Cantor was last month. Well, now sadly it's passed the House and with wide bipartisan support and it's due for a vote in the Senate this Tuesday.

Eliot Spitzer, filling in for Keith Olbermann on Countdown spoke to The American Prospect's Robert Kuttner about the bill this Monday evening -- Robert Kuttner excoriates the creators and supporters of the JOBS Act, says it will strip investor protections :

Robert Kuttner, co-editor of The American Prospect and a senior fellow at Demos, and Eliot Spitzer, former governor of New York, discuss the nefarious intentions of the JOBS (Jumpstart Our Business Startups) Act. “The one thing we have going for us is, there are disclosure laws so that if investors have the wit to read the disclosures, they can protect themselves, and that’s what this wretched piece of legislation would gut. Shame on anybody who votes for this,” says Kuttner.

Thankfully as the Politico article linked above noted and as Kuttner pointed out, there is still some hope that this can get stalled or amended in the Senate since there are actually a number of Senators who have the sense to realize that this bill should not pass.

Here's more from Bloomberg News -- Small Biz Jobs Act Is a Bipartisan Bridge Too Far:

A spirit of bipartisanship is sweeping Capitol Hill, with lawmakers poised to approve a package of bills aimed at reducing regulatory burdens on small business.

We wish we could raise a glass. This moment has been too long in coming. But the legislation it has spawned would be dangerous for investors and could harm already fragile financial markets.

At issue is a measure called Jumpstart Our Business Startups, or JOBS Act, which lawmakers in both parties claim would relieve small businesses seeking to raise capital from burdensome regulations, and thereby create jobs. The U.S. House overwhelmingly passed the measure 390-23 last week, and the Senate is expected to consider it this week. The White House has said President Barack Obama will sign the legislation.

We agree that red tape can needlessly tie up small companies. We also agree that securities laws that bar startups from harnessing the power of the Internet to raise funds could use updating. And it makes sense to allow, as the bill does, an initial public offering on-ramp, which would give startups a chance to grow before saddling them with certain costly and time-consuming regulations.

Accounting Scandals

But the JOBS Act goes too far. It would gut many of the investor protections established just a decade ago in the 2002 Sarbanes-Oxley law. A wave of accounting scandals -- think Enron and WorldCom -- had destroyed the nest eggs of millions of Americans and upended investor confidence in Wall Street. The relief would extend beyond small businesses and apply to more than 90 percent of companies that go public.

Lots more there so go read the rest. Here's more from Spitzer at Slate -- Kill the JOBS Act!:

The appalling bill that would repeal essential Wall Street reforms.

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