"I don't think it will have much direct impact on regulation," writes Kent Smetters, professor of business and public policy at the Wharton School at the University of Pennsylvania, in an E-mail to U.S. News. However, it may simply mean that opponents of new regulations have a harder road ahead.
Though the Volcker Rule is scheduled to go into effect in July, the agencies drafting the rule aren't expected to have completed their work by then. In February, Fed Chairman Ben Bernanke told Congress members that there were "a lot of very difficult issues to go through" on the complex regulation, and that he didn't know the exact date when it would be finished. The J.P. Morgan losses may hurt the case of those who would still seek to weaken that rule.
"This incident does help undermine the case of those who wanted to undo some of the new regulatory apparatus created by the Dodd-Frank Act, especially the Volcker Rule. Hence, the biggest impact will likely take the form of what won't be done—the reversal of new regulation—rather [than] what will be done," he writes.
Danielle Kurtzleben is a business and economics reporter for U.S. News & World Report. Connect with her on Twitter at @titonka or via E-mail at dkurtzleben@usnews.com.
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