President Obama recent calls that the Federal Government has to incorporate Paul Volcker's concerns about investment banking's risky activities in its reform of America's financial regulations is commendable but doesn't go far enough. Mr. Volcker's warnings are that the Federal Government has to restrict these large bank holding companies that are combinations of regular commercial (deposit taking) banks and investment banks from engaging in proprietary trading that is where they engage in trading and investment activity with their own money because the American people are heavily exposed to incurring financial losses with this proprietary activity. This is because the American people through the FDIC insures the bank deposits in these behemoth banks and the Federal Reserve bank through its lending vehicles for banks often loans these large bank holding companies money and if these proprietary investing activities go south these big banks may not be able to pay back their depositors or the Federal Reserve which in that case would mean the American people would be incurring the losses. Restricting proprietary trading activity for these big banks doesn't go far enough. Congress and the President need to embrace the essence of the current McCain/Cantwell bill which which would separate regular commercial and investment banks and thus be returning America to the way things existed in the past, under the Glass Steagall Act which was repealed after 66(6) years in existence (in 1999), which would be adhering to a major precept of wisdom which is America shouldn't be joining investment banks with commercial (deposit taking) banks because investment banking is a riskier activity than traditional banking and if the banks are combined the traditional bank would be exposed to the investment banking risk. The problem with just guarding against the Volcker identified dangers is that they fail to protect the banking system from readily foreseeable dangers and in fact dangers which the American people saw in the early part of the current recession. It is not the danger that banks will lose such amounts of money that they won't be able to pay their depositors or the Federal Reserve bank monies owed, the problem is that they will only lose sufficient levels of money where there stock price will drop precipitously where depositors amongst the general public will lose confidence in the bank and pull out their money and investors will lose confidence that if they loan or invest additional monies with the bank through the purchase of stock or bonds they will lose their investment. When a bank through losses experiences this deep lack of confidence of depositors and/or investors the bank is often fatally wounded and it is only a matter of time before the FDIC has to step in and either forcibly sell or shut down the bank or the federal government has to bail out the bank. The histories of the bank failure of Washington Mutual in 2008 with $ 310 billion in assets and the government forced sale of Wachovia bank in 2008 with over $350 billion in deposits are examples of this depositer and investor confidence problem which should be considered in deternmining what actiion to take in reforming America's financial system. The White House on this overall issue has been known to say that America can't return to the past can't rewind the clock can't go back to this Glass-Steagall preseritpiton it is too impractical. This position is too cynical, it has been reported that for one Goldman Sachs has a plan to spin off its deposit taking portion of its bank if new federal regulations force their hand, consider the businesses that AIG and Citigroup have or will sell integral parts of their organization are or will be chopped off. It is doable granted Wall Street won't like it, but that shouldn't be top priority in regulation reform. Acting consistent with wisdom the Congress and the President in changing the law back to where commercial and investment banks were separated could allow commercial banks to do a small amount of bond underwriting to generate income but put a prescription in where commercial banks can do underwriting as long as the total number of bonds on their books doesn't exceed five percent of their deposits. This would allow these banks to facilitate the securities of home loans and help lower home loan interest rates and help states and municipalities raise capital through bond issues, etc.. In addition, if the Congess and the President adopt the Glass-Steagall bank separation prescriptions than the they can drop this prohibition of proprietary trading by investment banks which is going to be hard as hell to police because investment bankers can just get around it by buying a business that will do the investment activity they want to do themselves, people in the know say it is going to extremely difficult to police this prohibition - the President and Congress should listen to them.