Even Sandy Weill Says We’ve Got to Restore Separation Between Banking and Financial Gambling
Every independent economist and financial expert says that failing to break up the giant banks is ruining the American economy.
Former Fed chairmen Greenspan and Volcker agree, as do presidents of various Federal Reserve banks and high-level Treasury officials, and the “central banks’ central bank.
But now even the banker most responsible for the creation of the too big to fails – former Citi boss Sandy Weill, who lobbied vigorously for a repeal of the Glass-Steagall act separating real banking from financial gambling – has called for them to be broken up:
What we should probably do is go and split up investment banking from banking, have banks be deposit takers, have banks make commercial loans and real estate loans, have banks do something that’s not going to risk the taxpayer dollars, that’s not too big to fail …
I’m suggesting that [the big banks] be broken up so that the taxpayer will never be at risk, the depositors won’t be at risk, the leverage of the banks will be something reasonable, and the investment banks can do trading, they’re not subject to a Volker rule, they can make some mistakes, but they’ll have everything that clears with each other every single night so they can be marked-to-market …
Without those changes, “this system is really immobilizing the banking system.
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.
For an interesting read on Sandy’s change of heart, check out FT AV:
http://ftalphaville.ft.com/blog/2012/07/25/1096041/sandy-weill-regurgitates-13-year-old-cake/
I applaud his decency for finally stating the completely obvious.
Now that countless trillions has been milked from the global economy, government debt to GDP not seen since WW2 & middle class net worth 40% lower over the last 5 years.
After all that wealth has been transferred to the net worth of banking executives like himself that now pay huge money in D.C. Lobby-bucks to ensure they don’t have to return any of it.
Now, it would be very nice if Paul Ryan would shut his pie hole, smell the coffee and realize an inverse tax policy is necessary to unwind/re-balance the damage instead of his Zombie-like insistence that even lower taxes for the wealthy and deep cuts to the impoverished will somehow work…this time.
He is pulling a “Greenspan.” Jumping ships after he got his loot. He is right up there with Capitan Renault!
http://youtu.be/SjbPi00k_ME
Poor Sandy Weill: punished by the fall in the stock of Citigroup, see how the world’s glory passes. Forbes ranking from 242 to 377 then off the list he goes, net worth sinking from $1.5B to $1.3B then to a miserable $0.95B! which got him off the list of the pretty people. 41% of his political contributions went to Dem’s, 11% to Rep’s, 48% to “special interests”. Wonder who those might be?
He must of sold all of his financial sector shares and is looking to buy them back at a secular low….. but they need to give him a reason to buy. Undoing all of his lobbying would be a good start to a reason.
Pretty much agree with all the above: Sandy Weill is way too little and way to late so this is just a variant of “screw you, I got mine.”
“Thievery is what unregulated capitalism is all about.” – Robert Sherrill (1990 statement about the S&L crisis)
And of course “he has action plan” to go along with it.http://www.youtube.com/watch?feature=player_detailpage&v=S21tC-JxWXA
@Frilton_Miedman – I agree wholeheartedly.
Now that the finaticals (financial elite and their political allies) have transferred massive of amounts of wealth from the 99% to the 1%, they are coming out and stating the obvious — that is, what was obvious 4 years ago.
It is time to claw back as much as possible of public money that went (and is still going) to plug up the banks leaking balance sheets. Unfortunately, most of it was used to plug phantom losses or distributed far beyond the walls of the financial institutions.
So. . . at the very least, let’s make sure ever finanical finds him/herself in the poor house, and that every loophole for the rich to hide their money and/or avoid taxes is closed shut.
Yeah…I am dreaming.
Poor, poor Sandy.
I’d like to believe it’s the biggest case of buyer remorse ever, but it smells rather like an outburst of ‘get off my lawn’.
But of course he’s right.
Perhaps I’m a simpleton…, but when someone finally agrees with me, I try to embrace it rather than digging down and dwelling on the problems of the path that they followed getting there.
I know, he’s doing a 180 degree turn. But are we better or worse off for him doing it? I’d say better….
Like Nixon going to China in 1972, he has the bones to know what he’s talking about and admits his mistake. Things happen for reasons not necessarily those you think, and the wise man does earliest what the fool does at the end. Change horses and move on.
“Banker Most Responsible for Allowing the Too Big to Fail Banks”
Former rabid capitalist turned conflicted socialist Hank Paulson invented TARP.
Running around in a panic screaming about once in a century hurricanes, earthquakes and tsunamis, Paulson convinced Congress the only way to save capitalism was to replace it with socialism unconditionally redistributing the people’s treasure to his friends on Wall Street, the very same perpetrators most responsible for seizing up the global financial system.
When TARP became law Paulson disregarded the legislation’s Main Street provisions. Instead, he spent the final months of his tenure giving away as much TARP money as possible as quickly as possible to what became TBTF.
Agree that they are late – but it is still surprising that there are so many of them willing to admit they were wrong. It is almost as if they realize that it WILL happen again pretty SOON – and after that they will (in their own lifetime) become the absolutely most hated people in this country. They are not just worried about their reputation after death they are worried about their life.
find it hard to believe that leopards change spots. Is it all possible that Weill is sitting on a heap of Citi stock that continues to languish and that suggesting a breakup might enhance the value of his holdings?
eliz Says:
July 25th, 2012 at 11:44 pm
“… Yeah…I am dreaming. …”
Me too, but I plan to sleepwalk while dreaming, the whole scam would have been impossible if not for mainstream complacency to facilitate it.
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