The Volcker Rule(s) is being implemented starting July 21st 2012. The rules stop banks from using federally guaranteed money that has been deposited to be risked in prop trading. The theme among many current articles is that this will "end prop trading"... I take it that this will not directly effect prop groups like Bright, Echo, WTS ect..ect..??? Any thoughts or is this a non-issue for us prop traders right now?
Not geared for prop shops. It's mostly to prevent proprietary trading, or the bank taking risky bets with customers deposits from checking, savings, money market and other types of account. What is possible is that rates will go up. Since some of this prop activity generates massive volume, it brings down rates for all firms on the streets. It may be a little more difficult to get these flat-clearing fees per symbol that some of the firms have on highly liquid small and medium caps.