Posts Tagged ‘economics’

Volcker Rule

Volcker Rule  福克规则

The Volcker Rule is a specific section of the Dodd–Frank Wall Street Reform and Consumer Protection Act originally proposed by American economist and former United States Federal Reserve Chairman Paul Volcker to restrict United States banks from making certain kinds of speculative investments that do not benefit their customers. Volcker argued that such speculative activity played a key role in the financial crisis of 2007–2010. The rule is often referred to as a ban on proprietary trading by commercial banks, whereby deposits are used to trade on the bank’s personal accounts, although a number of exceptions to this ban were included in the Dodd-Frank law. The rule’s provisions are scheduled to be implemented as a part of Dodd-Frank on July 21, 2012.

Volcker Rule-福克规则是(Dodd-Frank)多德-法兰克华尔街改革和消费者保护法的特定部分,最初是由美国经济学家,前美国联邦储备委员会主席(Paul Volcker)保罗福克提出来限制美国银行某些对客户无益的投机性投资。福克辩说这种投机活动在2007-2010年的金融危机里是要角。该规则通常是指禁止商业银行的专有交易,即使用银行的个人账户存款作交易,虽然Dodd-Frank法里包含了这一禁令的一些例外状况。这个规则的条件原定在2012年7月21日当作Doo-Frank法的一部份实施。


Contents  目录

·      Background 背景

·      Proposal 建议

·      Implementation 实施

·      Historical antecedents 历史性前例

·      See also 另见


Background  背景

Volcker was appointed by President Barack Obama as the chair of the President’s Economic Recovery Advisory Board on February 6, 2009. President Obama created the board to advise the Obama Administration on economic recovery matters. Volcker argued vigorously that since a functioning commercial banking system is essential to the stability of the entire financial system, for banks to engage in high-risk speculation created an unacceptable level of systemic risk. He also argued that the vast increase in the use of derivatives, designed to mitigate risk in the system, had produced exactly the opposite effect.



Proposal  提议

The Volcker Rule was first publicly endorsed by President Obama on January 21, 2010. The proposal specifically prohibits a bank or institution that owns a bank from engaging in proprietary trading that isn’t at the behest of its clients, and from owning or investing in a hedge fund or private equity fund, as well as limiting the liabilities that the largest banks could hold. Under discussion is the possibility of restrictions on the way market making activities are compensated; traders would be paid on the basis of the spread of the transactions rather than any profit that the trader made for the client.

福克规则在2010年1月21日由奥巴马总统首度公开批准。该提案明确禁止银行或拥有银行的机构从事自营不是客户基本要求的专有交易,也禁止拥有或投资在对冲基金或私人股权基金里,还限制了最大家银行的债务。正在讨论的包括限制市场收费活动的可能性; 交易商将以一篮子交易的基础去收费,而不是根据他们为客户赚取的利润去收费。

On January 21, 2010, under the same initiative, President Obama announced his intention to end the mentality of “Too big to fail.”

2010年1月21日,在同样的倡议下,奥巴马总统宣布他打算结束“ 大到不能倒” 的心态。

In a February 22, 2010 letter to The Wall Street Journal, five former Secretaries of the Treasury endorsed The Volcker Rule proposals. As of February 23, 2010, the US congress began to consider a weaker bill allowing federal regulators to restrict proprietary trading and hedge fund ownership by banks, but not prohibiting these activities altogether.


Senators Jeff Merkley, Democrat of Oregon, and Carl Levin, Democrat of Michigan, introduced the main piece of the Volcker Rule – its limitations on proprietary trading – as an amendment to the broader Dodd-Frank financial reform legislation that was passed by the United States Senate on May 20, 2010. Despite having wide support in the Senate, the amendment was never given a vote. When the Merkley-Levin Amendment was first brought to the floor, Senator Richard Shelby, Republican of Alabama, objected to a motion to vote on the amendment. Merkley and Levin responded by attaching the amendment to another amendment to the bill put forth by Senator Sam Brownback, Republican of Kansas. Shortly before it was due to be voted upon, Brownback withdrew his own amendment, thus killing the Merkley-Levin amendment and the Volcker Rule as part of the Senate bill.

(Oregon)俄勒冈州的民主党参议员Jeff Merkley和(Michigan)密歇根州的民主党参议员Carl Levin介绍了福克规则的主要部份-也就是自营交易的限度-作为更广泛的,在2010年5月20日由参议院决议通过的Dodd-Frank金融改革法案中的修正案。尽管修正案在参议院获得广泛支持,但却没有投票表决。当Merkley-Levin修正案首次提出来时,(Alabama)阿拉巴马州的共和党参议员Richard Shelby反对要对修正案进行表决的提议。Merkelay和Levin回应,把这个修正案附加在另一个由(Kansas)堪萨斯州参议员Sam Brownback提出的修正案之上。就在投票表决的前一刻,Brownback撤回自己的修正案,从而扼杀了这个法案中的Merkley-Levin修正案和福克规则部份。

Despite this vote, this proposal made it into the final legislation when the House-Senate conference committee passed a strengthened version of the rule that included the language prepared by Senators Merkley and Levin. The original Merkley-Levin amendment and the final legislation both covered more types of proprietary trading than the original rule proposed by the administration. It also banned conflict of interest trading. Senator Levin commented on the importance of that aspect: “We are also pleased that the conference report includes strong language to prevent the obscene conflicts of interest revealed in the Permanent Subcommittee on Investigations hearing with Goldman Sachs. This is an important victory for fairness for investors such as pension funds and for the integrity of the financial system. As the Goldman Sachs investigation showed, business as usual on Wall Street has for too long allowed banks to create instruments which are based on junky assets, then sell them to clients, and bet against their own clients by betting on their failure. The measure approved by the conferees ends that type of conflict which Wall Street has engaged in.”


However, conferees changed the proprietary trading ban to allow banks to invest in hedge funds and private equity funds at the request of Senator Scott Brown (R-Mass.), whose vote was needed in the Senate to pass the bill. Proprietary trading in Treasurys, bonds issued by government-backed entities like Fannie Mae and Freddie Mac, as well as municipal bonds is also exempted.

然而,与会者改变了自营交易的禁令,允许银行投资在对冲基金和私募股权基金上,因为是参议员Scott Brown要求的(R-Mass.马塞住塞州),参议院需要他的票来表决通过该法案。自营买卖国债,政府支持的个体如房利美(Fannie Mae)和房地美(Freddie Mae)发行的债券和市政府的债权也得到豁免。

Since the passage of the Financial Reform Bill, many banks and financial firms have indicated that they don’t expect The Volcker Rule to have a significant impact on their profits.



Implementation  实施

Public comments to the Financial Services Oversight Council on how exactly the rule should be implemented were submitted through November 5, 2010. Financial firms such as Goldman Sachs, Bank of America, and JPMorgan Chase & Co. posted comments expressing concerns about the rule. Republican representatives to Congress have also expressed concern about the Volcker Rule, saying the rule’s prohibitions may hamper the competitiveness of American banks in the global marketplace, and may seek to cut funding to the federal agencies responsible for its enforcement. Incoming Chairman of the House Financial Services Committee, Representative Spencer Bachus (R-Alabama), has stated that he is seeking to limit the impact of the Volcker Rule, although Volcker himself has stated that he expects backers of the rule to prevail over such critics.

2010年11月5日,公众对于金融服务监督委员会应该如何实施这些规则提呈了评论。金融机构如高盛,美国银行,摩根大通公司发表评论表示关注这个规则。国会的共和党代表也对福克规则表示担忧,认为规则的禁令可能会阻碍美国银行在全球市场的竞争力,可能会削减负责执法的联邦机构的经费。即将就任的众议院金融服务委员会主席,现代表Spencer Bachus(R-Alabama阿拉巴马州)声明,他要限制福克规则的冲击力,虽然福克本人也表明,他预计该规则的支持者会战胜批评者。

Tom McMahon, head of the progressive lobbying group Americans for Progressive Change, responded to comments by Republican leaders by saying “It is truly astounding that less than a day after winning control of the people’s House of Representatives, Republican leaders are already hard at work doing the business of big Wall Street banks.”

Tom McMahon这位美国持续改变的持续游说团头头回应共和党领袖的评论说:“真的很惊人,赢得人民的众议院的控制权之后不到一天时间,共和党领导人就已经努力在做华尔街大型银行的生意。”

Regulators presented a proposed form of the Volcker Rule for public comment on October 11, 2011, which was approved by the SEC, The Federal Reserve, The Office of the Comptroller of the Currency and the FDIC. The proposed regulations were immediately criticized by banking groups as being too costly to implement, and by reform advocates for being weak and filled with loopholes. On January 12, 2012 CFTC became the final major regulator to vote in favor of the bill.


Volcker himself stated that he would have preferred a simpler set of rules: “I’d write a much simpler bill. I’d love to see a four-page bill that bans proprietary trading and makes the board and chief executive responsible for compliance. And I’d have strong regulators. If the banks didn’t comply with the spirit of the bill, they’d go after them.”


Regulators have given the public until February 13, 2012 to comment on the proposed draft of the law. Under the Dodd-Frank financial reform bill, the regulations go into effect on July 21, 2012.



Historical antecedents 历史性前例

The Volcker Rule has been compared to, and contrasted with, the Glass–Steagall Act of 1933.[28] Its core differences from the Glass–Steagall Act have been cited by scholars as being at the center of the rule’s identified weaknesses.



See also  另见

  • 2008–2010 bank failures in the United States。2008-2010年美国的银行倒闭
  • 2008–2009 Keynesian resurgence。2008-2009凯恩斯主义的回潮
  • Brown–Kaufman amendment 。Brown-Kaufman的修正案

Categories  分类

  • Systemic risk 系统性风险
  • Financial terminology 金融术语
  • Financial regulation in the United States 美国的金融监管

—— END ——


Source > Wikipedia at

Translated by > BlogHost — hkTan

Word Count > approx. 1370 words in English



April 21, 2012 Leave a comment

Seigniorage 铸币税


Seigniorage (also spelled seignorage or seigneurage) can have the following two meanings:

铸币税-Seigniorage (也唸成seignorageseigneurage),可以有以下两种含义:

Seigniorage derived from specie—metal coins, is a tax, added to the total price of a coin (metal content and production costs), that a customer of the mint had to pay to the mint, and that was sent to the sovereign of the political area.


Seigniorage derived from notes is more indirect, being the difference between interest earned on securities acquired in exchange for bank notes and the costs of producing and distributing those notes.


Seigniorage is a convenient source of revenue for some governments.



Contents 目录

1 Examples  例子

1.1 Scenario A  案例A

1.2 Scenario B  案例B

2 Ordinary seigniorage  普通铸币税

2.1 Solvency constraints of central banks  央行的偿付能力局限

2.2 Seigniorage as a tax  铸币税的税收

3 Seigniorage today  现今的铸币税

3.1 2011 U.S. debt ceiling crisis  2011年美国债务上限的危机

4 Overseas circulation  海外流通

5 See also  另见

6 References  参考文献

7 External links  外部链接


Examples  例子

Scenario A  案例A

A person has one ounce of gold, trades it for a government-issued gold certificate (providing for redemption in one ounce of gold), keeps that certificate for a year, and then redeems it in gold. That person ends up with exactly one ounce of gold again. No seigniorage occurs.


Scenario B  案例B

Instead of issuing gold certificates, a government converts gold into currency at the market rate by printing paper notes. A person exchanges one ounce of gold for its value in currency. They keep the currency for one year, and then exchange it all for an amount of gold at the new market value. This second exchange may yield more or less than one ounce of gold if the value of the currency relative to gold has changed during the interim. (Assume that the value or direct purchasing power of one ounce of gold remains constant through the year.)


If the value of the currency relative to gold has decreased, then the person receives less than one ounce of gold. Seigniorage occurred.


If the value of the currency relative to gold has increased, the redeemer receives more than one ounce of gold. Seigniorage did not occur.


Seigniorage, therefore, is the positive return on issuing notes and coins, or “carry” on money in circulation.


The opposite, “cost of carry”, is not regarded as a form of seigniorage.



Ordinary seigniorage  普通铸币税

Ordinarily seigniorage is only an interest-free loan (for instance of gold) to the issuer of the coin or paper money. When the currency is worn out, the issuer buys it back at face value, thereby balancing exactly the revenue received when it was put into circulation, without any additional amount for the interest value of what the issuer received.


Historically, seigniorage was the profit resulting from producing coins. Silver and gold were mixed with base metals to make durable coins. Thus the British “sterling” was 92.5% pure silver; the base metal added (and thus the pure silver retained by the government mint) was (less costs) the profit, the seigniorage. USA gold coins were made from 90% gold, 7% silver, and 3% copper; one can easily see the seigniorage.


Currently, under the rules governing monetary operations of major central banks (including the central bank of the USA), seigniorage on bank notes is simply defined as the interest payments received by central banks on the total amount of currency issued. This usually takes the form of interest payments on treasury bonds purchased by central banks, putting more dollars into circulation. However, if the currency is collected, or is otherwise taken permanently out of circulation, the back end of the deal never occurs (that is, the currency is never returned to the central bank). Thus the issuer of the currency keeps the whole seigniorage profit, by not having to buy worn out issued currency back at face value.



Solvency constraints of central banks  央行的偿付能力局限

The solvency constraint of the standard central bank only requires that the present discounted value of its net non-monetary liabilities (separate from its monetary liabilities accrued through seigniorage attempts) be zero or negative in the long run. Its monetary liabilities are liabilities only in name, as they are irredeemable: the holder of base money cannot insist at any time on the redemption of a given amount of base money into anything else other than the same amount of itself (base money) — unless, of course, the holder of said base money is another central bank reclaiming the value of its original interest-free loan.



Seigniorage as a tax  铸币税的税收

Some economists regarded seigniorage as a form of inflation tax, redistributing real resources to the currency issuer. Issuing new currency, rather than collecting taxes paid out of the existing money stock, is then considered in effect a tax that falls on those who hold the existing currency. The expansion of the money supply may cause inflation in the long run.


This is one reason offered in support of free banking, a gold standard, or at a minimum the reduction of political control over central banks. The latter could then take as their primary objective ensuring a stable value of currency by controlling monetary expansion and thus limiting inflation. Independence from government is required to reach this aim – indeed, it is well known in economic literature that governments face a conflict of interest in this regard[citation needed]. In fact, “hard money” advocates argue that central banks have utterly failed to obtain the objective of a stable currency. Under the gold standard, for example, the price level in both England and the US remained relatively stable over literally hundreds of years, though with some protracted periods of deflation. Since the US Federal Reserve was formed in 1913, however, the US dollar has fallen to barely a twentieth of its former value through the consistently inflationary policies of the bank. Economists counter that deflation is hard to control once it sets in and its effects are much more damaging than modest, consistent inflation.


Banks or governments relying heavily on seigniorage and fractional reserve sources of revenue can find it counterproductive. Rational expectations of inflation take into account a bank’s seigniorage strategy, and inflationary expectations can maintain high inflation . Instead of accruing seigniorage from fiat money and credit most governments opt to raise revenue primarily through taxation and other means.



Seigniorage today  现今的铸币税

The “50 State” series of quarters (25-cent coins) was launched in the U.S. in 1999. The U.S. government planned on a large number of people collecting each new quarter as it rolled out of the U.S. Mint, thus taking the pieces out of circulation[citation needed]. Each set of quarters is worth $14.00 (a complete set includes quarters for all fifty states, the five U.S. territories, and the District of Columbia). Since it costs the Mint about five cents for each 25-cent piece it produces, the government made a profit whenever someone “bought” a coin and chose not to spend it. The U.S. Treasury estimates that it has earned about US$6.3 billion in seigniorage from the quarters over the course of the entire program.


In some cases, national mints report the amount of seigniorage provided to their respective governments; for example, the Royal Canadian Mint reported that in 2006 it generated $C93 million in seigniorage for the Government of Canada. The US government, the largest beneficiary of seignorage, earned approximately $25 billion annually as of 2000.

在某些情况下,国家铸币厂向各个政府报告提供的铸币税金额; 例如,加拿大皇家铸币厂在2006年向加拿大政府报告赚取了九千三百万加拿大币。美国政府这个铸币税的最大受益者每年赚取了大约250亿美元,截至2000年为止。

According to some reports, currently over half the revenue of the government of Robert Mugabe in Zimbabwe is in seigniorage. Zimbabwe has experienced hyperinflation (see Hyperinflation in Zimbabwe), with the annualized rate at about 24,000% in July 2008 (prices doubling every 46 days).



2011 U.S. debt ceiling crisis   2011年美国债务上限的危机

On 3 January 2011, a blogger suggested seigniorage as a solution to the 2011 U.S. debt ceiling crisis. This was covered on Slate online, on 29 July 2011 when it was suggested that a US$5 trillion coin could be minted and deposited with the Federal Reserve and used to buy back debt thus making funds available.



Overseas circulation  海外流通

A very profitable type of seignorage is from the international circulation of banknotes. While the cost of printing banknotes is minimal, the foreign entity must provide goods and services at the face value of the note to obtain it. The banknote is retained because the entity values it as a store of value because of mistrust of the local currency.


Overseas circulation is intimately tied in with large value banknotes. One purpose of using foreign currency is for store of value, but another is efficiency of private transactions many of which are illegal.


American currency has been circulating globally for most of the 20th century. Certainly in WWII, the amount of currency in circulation was increased several fold. However, the modern era of huge printings of the United States one hundred-dollar bill started with the fall of the Soviet Union in 1991. Production was quadrupled with the first ever trillion dollar printing of this bill. As of the end of 2008, U.S. currency in circulation with the public amounted to $824 billion and 76% of the currency supply was in the form of $100 denomination banknotes, amounting to twenty $100 bills per U.S. citizen. Over the past decade there has been considerable controversy concerning the amount of U.S. currency circulating abroad. Porter and Judson have claimed that in the mid nineties between 53-67 percent of U.S. currency was overseas, whereas Feige’s estimates suggested a figure closer to 40 percent abroad. Most recently, Goldberg writing in a New York Federal Reserve publication asserted that “about 65 percent ($580 billion) of all banknotes are in circulation outside of the country. However, these assertions are contradicted by the Federal Reserve Board of Governors Flow of Funds statistics which show that at the end of March 2009, only $313 billion (36.7 percent) of U.S. currency was held abroad. Feige calculates that since 1964, “the cumulative seigniorage earnings accruing to the U.S. by virtue of the currency held by foreigners amounted to $167-$185 billion and over the past two decades seigniorage revenues from foreigners have averaged $6-$7 billion dollars per year”.


The American $100 bill has some competition, primarily from the €500 note. The larger value of the banknote makes it easier to transport larger amounts of money. As an example, to carry $1 million in currency on board an airplane, and it is in $100 bills, the weight of the money is 22 pounds. It is difficult to carry this much without a briefcase and some physical security. Since it is against authority of Title 26 of the United States Code (U.S.Tax Code) regulations to carry more than $10,000 without reporting it (31 USC 5311), it is unlikely to pass security unnoticed. The same amount in €500 notes would weigh less than three pounds, and it could probably be dispersed in clothing and in luggage without attracting attention or alerting a security device. For many illegal operations the problem of transporting currency is more difficult than transporting cocaine because of the size and weight of the currency. The ease of transporting banknotes makes the euro very attractive to Latin American drug cartels.

美国的百元美钞也面对一些竞争,主要是€500欧元的纸钞。面值大的钞票方便转移大数额的钱。打个比方,带着一百万的货币登机,如果是百元钞,钱的重量是22磅。因此很难不用公事包和一些保安措施来携带这么多钱。由于这个做法违反了“美国法典”(US税务守则)第26条的规定,携带超过一万元却不通报(31 USC 5311),就很难通过安检。同等数量的€500欧元纸币的重量就少过三磅,很容易藏在服装和行李箱里分散开来而不引起人们的注意或触动保安设备。对许多非法行动来说,运送货币比起运输可卡因还困难,问题出在纸币的体积和和重量。轻易可运送钞票的欧元就吸引了拉丁美洲的毒品商。

The Swiss 1000 franc note is probably the only other banknote that is in circulation outside of its home country. It is worth slightly more than US$1000. However, to the non-Swiss it doesn’t provide a significant advantage over the €500 note as there are 20 times as many of the €500 note circulating and they are more widely recognized. As a reserve currency it is roughly 0.1% of the currency composition of official foreign exchange reserves.


Governments differ radically in their issuance of large banknotes. As of August 2009, the number of 1000 franc Swiss banknotes circulating is over 3 times the population of Switzerland. In comparison the number of £50 banknotes circulating slightly less than 3 times the population of UK. But the 1000 franc banknote is worth roughly £600. The British government has traditionally been wary of large banknotes since the counterfeiting Operation Bernhard in World War II which caused the Bank of England to withdraw all notes larger than £5 from circulation, and not reintroduce other denominations until the early 1960s (£10), 1970 (£20) and March 20, 1981 (£50). Circulation rates are so low that Britain could stop printing the £50 note and much of the population wouldn’t notice.


There is a banknote for 500 Latvian lats which is currently one of the most valuable notes in the world, as it is worth more than $1000, but it is unlikely to be accepted outside of Latvia. Likewise, the 10000 Singapore dollar note is the most valuable, but is rarely used and unlikely to be accepted outside of Singapore. Other currencies in Europe, like the British pound, and the Scandinavian currencies do not issue large value banknotes. Iceland in particular has never needed much currency since electronic transactions are commonplace, and their population is small with over 60% of the population living in one metropolitan area. Their largest banknote is worth less than €28.


South Korea is an example of a country with a high Human Development Index that fears counterfeiting so much that they don’t utilize large banknotes. South Korea has a larger purchasing power parity per capita than Latvia, but until recently the largest South Korean banknote was worth about US$8, which was a severe impediment to routine business. On June 23, 2009 they issued a new banknote worth five times as much.


The American treasury considered re-issuing a US$500 banknote when the euro banknotes began circulating. There was concern that the high value banknotes would provide competition. However, after recognition that the $500 banknote would provide a huge advantage to worldwide criminal operations and dictatorships, the decision was made not to pursue this option.


Canada briefly issued a $1000 Canadian dollar bill in 1992, but the Royal Canadian Mounted Police was able to successfully argue against the continued printing of this bill in 2000; it is still legal tender but no more are being printed, and it will diminish as older bills are destroyed. It was not widely circulated outside of Canada.



See also  另见

  • Central bank  中央银行
  • Digital gold currency  数码式黄金货币
  • Fractional reserve banking  部分储备金银行
  • Full reserve banking  全储备银行
  • Money  货币
  • Monetarism  货币主义
  • Demurrage (currency)  滞期费(货币)


External links  外部链接

  • Extensive discussion   广泛的讨论
  • Sovereignty & Seignorage  主权和铸币税
  • Information about Seigniorage  关于铸币税的信息
  • “The temptation of dollar seigniorage”, By Kosuke Takahashi of Asia Times Online, January 23, 2009.

美元铸币税“的诱惑” , 耿介高桥撰,亚洲时报在线 ,2009年1月23日。

  • “A better way to account for fiat money at the Central Bank” By Thomas Colignatus, December 31, 2005

“一个审计中央银行的法定货币更好的办法” Thomas Colignatus撰,2005年12月31日


Categories  分类

  • Numismatics  钱币学
  • Taxation  税务

—— END ——


Source >

Translated by > BlogHost

Word Count > approx. 2250 words in English


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