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.