Volcker’s Understanding Of PE Comes Across As Hazy

” Former Federal Reserve chairman Paul Volcker might want to bone up on the differences between private equity and hedge funds after a Congressional hearing Tuesday.

At the hearing before the Senate Committee on Banking, Housing and Urban Affairs, Volcker testified on proposed regulation bearing his name that would ban commercial banks from investing in private equity or hedge funds, as well as from engaging in proprietary trading.

At one point, he made a general comment to the effect that private equity is just as risky an activity for banks to engage in as hedge fund investing or proprietary banking activity. The three are “substitutable,” he said. ” by Jennifer Rossa on the blog Private Equity Beat,  The Wall Street Journal Europe

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