Volcker Rule Just Went To Plaid  Um what?  Volcker Rule Won’t
Allow Banks to Use ‘Portfolio Hedging’  This has gotta be a
joke. When the idea of ‘banning’ ‘portfolio hedging’ was first
kicked around, I thought it was a joke that would obviously
never fly.  Now it’s apparently the rule, ‘because of the London
Whale’. Regulators have just gone full retard. Never go full
retard.  What on earth can broker-dealer banks do now? Take the
simplest case and imagine they have a bunch of corporate or
investment-grade mortgage bonds. Their risk calculation decides
that interest-rate-wise those bonds amount to being long X
amount of 10-year Treasuries. Typically they’d make sure to be
short around X 10-years against them. But now they can’t, right?
Someone help me out because how can a rule banning ‘portfolio
hedging’ not ban that?  Okay, so (following the logic) they then
have to hedge every single line item individually. Such-and-such
bond is risk-equivalent to $137,232.73 worth of 10-years. So
they short exactly $137,2