Numerous Top Bankers Call for Break Up of Giant Banks.  The following bankers are calling for the big banks to be broken up:

-Former Citi CEO Sandy Weill

-Former Citi CEO John Reed

-Former Citi chairman Richard Parsons

-Former Merrill Lynch chairman and CEO David Komansky

-Former Morgan Stanley CEO Philip Purcell

-Former managing director of Goldman Sachs – and head of the international analytics group at Bear Stearns in London- Nomi Prins

-Numerous other bankers within the mega-banks (see this, for example)

-Former Natwest and Schroders investment banker, Philip Augar

-The President of the Independent Community Bankers of America, Camden Fine

Top Economists and Financial Experts Agree

It’s not just bankers. The following top economists and financial experts believe that the economy cannot recover unless the big, insolvent banks are broken up in an orderly fashion:

-Nobel prize-winning economist, Joseph Stiglitz

-Nobel prize-winning economist, Ed Prescott

-Nobel prize-winning economist, Paul Krugman

-Former chairman of the Federal Reserve, Alan Greenspan

-Former chairman of the Federal Reserve, Paul Volcker

-Former Secretary of Labor Robert Reich

-Dean and professor of finance and economics at Columbia Business School, and chairman of the Council of Economic Advisers under President George W. Bush, R. Glenn Hubbard

-Former chief economist for the International Monetary Fund, Simon Johnson (and see this)

-Former 20-year President of the Federal Reserve Bank of Kansas City – currently FDIC Vice Chair – Thomas Hoenig (and see this)

-President of the Federal Reserve Bank of Dallas, Richard Fisher (and see this)

-President of the Federal Reserve Bank of St. Louis, Thomas Bullard

-Deputy Treasury Secretary, Neal S. Wolin

-The Congressional panel overseeing the bailout (and see this)

-The former head of the FDIC, Sheila Bair

-The head of the Bank of England, Mervyn King

-The Bank of International Settlements(the “Central Banks’ Central Bank”)

-The leading monetary economist and co-author with Milton Friedman of the leading treatise on the Great Depression, Anna Schwartz

-Economics professor and senior regulator during the S & L crisis, William K. Black

-Leading British economist, John Kay

-Economics professor, Nouriel Roubini

-Economist, Marc Faber

-Professor of entrepreneurship and finance at the Chicago Booth School of Business, Luigi Zingales

-Economics professor, Thomas F. Cooley

-Economist Dean Baker

-Economist Arnold Kling

-Chairman of the Commons Treasury, John McFall

Category: Bailouts, Really, really bad calls, Regulation

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

28 Responses to “Banking Titans Call for Break Up of “Too Big to Fail””

  1. machinehead says:

    Wonderful.

    But don’t forget the baddest banksters of all: the Federal Reserve central planners, with their monstrous $3.5 trillion off-balance sheet custody fund:

    http://federalreserve.gov/releases/h41/Current/

    Demolish the Eccles Building, and plow the ground with salt. Amen.

  2. bda_guy says:

    But will it take the collapse of the banking system before the politicians that suck at the teet of the various banking lobbying interests agree?

  3. Petey Wheatstraw says:

    So, some bankers/former bankers and a few economists have figured out the obvious (I have to assume the former bankers have already milked the system for all they could).

    Add their numbers to the vast majority of the thinking/aware population.

    Still, nothing will change, as long as there’s something left to loot.

  4. Global Eyes says:

    Glass-Steagal was a good law. Repealing it was a mistake. It didn’t cost a penny but prevented costly messes like today. Whenever history repeats it becomes more expensive.

  5. sparta47 says:

    Congress & the President will continue to follow the Money.

    Bankster will preach Free Market & Deregulation while preaching the need for taxpayer protection, which greatly subsidizes their cost of capital.

    Breakup will not happen.

  6. BusSchDean says:

    A case of a few powerful people thinking they were smarter those those silly people who read a bit of history. In the future we would have a “new” economy, not like that old stuffy one where deposits were safe.

    The early telltale signs were when years ago bank tellers (my sister was one at the time) complained that they were being turned into sales people for the investment side – millions of people being told by the person they gave their check to every two weeks that they could trust the bank. Even the sales people wondered if it was true.

  7. lalaland says:

    Wait, Spot The Socialist is the NEXT post? (j/k)

  8. jlj says:

    & your point? What did Stalin say in regards to the Pope’s strategy on where the Allies should invade Europe, “How many divisions does he have?” So how many lobbyists and much lobbying money do they have?

  9. rd says:

    Petey Wheatstraw

    The former bankers don’t have to show growth to their investors or collect a monstrous pay check for running a really big firm. Breaking up the big banks would probably add value to investors by selling off the parts but there would need to be more CEOs making less money each because each individual company would be smaller. Jamie Dimon et al have no interest in that part of the equation.

  10. kaleidic says:

    It is not a Nobel Prize, it is the Swedish Central Bank Prize. If the Academy Awards decided to call the Best Actor Prize the Nobel Prize in Acting, that would not make it a Nobel Prize. The mathematicians do not call the Fields Medal the Nobel Prize in Mathematics. What kind of a prize is it when economists with radically different views of the nature of economic behavior get it in ping-pong style, like if one year the physics prize is awarded to say Copernicus, the next year to someone who has developed the latest thing in epicycles, the next year to Einstein (if only), etc.

  11. …Still, nothing will change, as long as there’s something left to loot…

    yes, We should wonder if that isn’t, exactly Correct.

    ‘We’, still, don’t know that ’008-’009 (and continuing..) ‘Banker “Bailout”‘ was, instead, a ‘Banker’ Takeover, do We?

  12. monzie9000 says:

    “Every nation has the government it deserves.”
    Joseph de Maistre
    Other than snarky comments, has any of you done anything to help resolve the situation? The bankers are killing this country, everyone is aware of it, and nobody does anything. The american public will reap what they sow.

  13. Dima says:

    WTF is with this post???? Does the blogger who posted this suffer from Stockholm syndrome?

  14. louis says:

    Once they are in their orange jumpsuits, then we will talk.

  15. carleric says:

    The simple inability of Congress to understand the problem, formulate a plan and implement the solution speaks volumes to the intellectual shortfalls of our elected officials….simply put they are too stupid and greedy to do the right thing.

  16. Ben Dover says:

    The hilarity of this is that the list of “people” are for the most part the ones who endorsed the financial supermarket model. Now they are trying to present themselves as statesmen by parroting the colloquism “End too big to fail”. It’s not that I don’t agree with it, but come on…… These are the same guys that looted the system to begin with, and now I should listen let alone trust them. When I see about 75% of these people doing the perp walk (never happen) then I’ll feel differently.

    Ben Dover indeed.

  17. DeDude says:

    It’s not just the repeal of Glass-Steagal that was a mistake. When we allowed the gamblers on Wall Street to get FDIC insured bank status we made an obvious mistake. Even bigger was the mistake of giving the derivative gambling profits priority above depositors when these “banks” fail.

    Most of these institutions are clearly run by sociopaths who have no concern for costumers, or for their country/community/society. They have used their power to game the system such that they can gamble like crazy in derivatives and get huge bonuses for themselves every single time they win. When the inevitable big time loss arrives, they gamed the system such that society, shareholders and low-level co-workers take the pain of their losses. Because they are sociopaths they see no problem with this – in their world it is every man for himself and who cares about anything else.

    They sociopathy also prevent them from understanding how normal people will react after the next collapse when these creeps run up in front of the line and scoop up their gambling profits and say: “I am VIP, I am first in line according to the law that my pet congress man passed for me, you sheeple can fight amongst yourself for the remaining scraps”. The bankers you list above are not that socially responsible, but they are smart enough to understand the damage to themselves that will come when normal people realize that they were screwed even worse than after the first collapse. The fact that so many banksters are coming out to ask for a small hit now must mean that we are fairly close to the next big collapse. They are scared, not about the direct pain from that collapse (which they already have insulated themselves from), but for the consequences when the sheeple finally wake up in rage.

  18. willid3 says:

    suspect that that the take over predated the current debacle. which only showed how deep it was. before that nobody cared since every thing seemed to be going well. at least as far as the politicians were concerned any way. but back in the real world, people knew some thing was wrong. but couldn’t get any politicians to help.

  19. singfoom says:

    It is excellent that these people have called for the end of Too Big Too Fail. Unfortunately, those who profit from TBTF have more “speech” than both the normal citizens or those who think TBTF needs to end. While I will try to remain optimistic that Glass Steagall might be restored and TBTF might be ended, I’ll believe it when I see it.

    The corruption of our government by those with billions of “speech” makes it hard for me to see a path that leads to the proper policies being enacted. Congress knows exactly who provides it with “campaign contributions”. Until that dynamic is changed (somehow by those inhabiting Congress), all the Nobel prize winners and titans of industry can call for whatever changes they want, and those voices will be drowned by those interested in the status quo “speaking” to Congress with their “campaign contributions”….

  20. 873450 says:

    We are beyond TBTF.
    This is just a list of people talking.
    SCOTUS via Citizens United gave Corporations with Money MORE RIGHTS than people talking.
    Anonymous money will determine 2012 election results.
    Wall Street captured all branches of government.
    Occupy will find a way to take it back or bust up TBTF some other unexpected way.

  21. 873450 says:

    DeDude Says:
    “Because they are sociopaths they see no problem with this”

    They actually believe getting bailed out merits a bonus.

  22. Frwip says:

    Purcell is an interesting case in this sorry lot. He was, for all practical matters, fired from Morgan Stanley for REFUSING to take higher risk and leverage in 2005. Gresham’s law in action, if there ever was a better, more perfectly timed example.

    But for the rest, I agree: orange jumpsuits first, talk later.

  23. “…Most Americans have a sense TARP was a badly managed program that bailed out “fat cat” bankers at the expense of U.S. taxpayers. Well, it’s even worse than you think, according to Neil Barofsky, former special inspector general for TARP (SIGTARP).

    Officials in both the Bush and Obama administrations took the attitude “bankers know best,” Barofsky recalls. “It was somewhat shocking how much control big banks had over their own bailout [and] the overwhelming deference show by Treasury officials to the banks.”

    Much has been made about Barofsky’s criticism of Treasury Secretary Tim Geithner, who told CBS News he is “deeply offended” by how he’s portrayed in Barofsky’s book Bailout: An Inside Account of How Washington Abandoned Main Street While Rescuing Wall Street.

    Barofsky pulled no punches in our earlier segment about the ongoing rate-rigging scandal. (See: “I Hope We See People In Handcuffs”: Neil Barofsky Weighs in on LIBOR Scandal)

    In the accompanying video, we focused more on TARP’s failings to live up to its promise to help individual Americans, not just the big banks…”

    http://finance.yahoo.com/blogs/daily-ticker/tarp-even-worse-think-abysmal-failure-barofsky-says-161743679.html?l=1

  24. XRayD says:

    Needs a few Republican Congressional leaders!

  25. [...] The Big Picture compiled an impressive list of noted titans in banking, economics and finance calling for the break up of ‘Too Big to Fail’ banks. [...]

  26. obsvr-1 says:

    So why not execute the “Break ‘em Up” clause of the Doodle-Frankie bill and break them up while we are in “Recovery” and not wait until the next Death March to Bailout occurs.

  27. [...] top-ranking Wall Street executive, recently criticized big banks. Two other former top executives, David H. Komansky and John S. Reed, have attacked the current financial system.The TradeView all postsArticle [...]

  28. [...] reminds me of former Citibank CEO Sandy Weill—among many other banking bigwigs—calling for a breakup of the big banks. In a recent episode of Democracy Now!, journalists Don [...]