The President of the Federal Reserve Bank of Minneapolis – who oversaw the Troubled Asset Relief Program (TARP) as Assistant Secretary of the Treasury for Financial Stability (Neel Kashkari) – says that the nation’s biggest banks remain too big to fail and pose significant risk to the economy
Kashkari joins the following top economists and financial experts who believe that the failure to rein in the “too big to fail” banks is unacceptable:
- Current chair of the Federal reserve, Janet Yellen (and see this)
- Former chairman of the Federal Reserve, Ben Bernanke
- Former chairman of the Federal Reserve, Alan Greenspan
- Former chairman of the Federal Reserve, Paul Volcker
- Former Secretary of the Treasury Secretary, Hank Paulson
- Former Secretary of Labor, Robert Reich
- Current Vice Chair and director of the Federal Deposit Insurance Corporation – and former 20-year President of the Federal Reserve Bank of Kansas City – Thomas Hoenig (and see this)
- Nobel prize-winning economist, Joseph Stiglitz
- Nobel prize-winning economist, Ed Prescott
- Nobel prize-winning economist, Paul Krugman
- Chief Stability Officer at the Bank of England, Andrew Haldane (and see this and this)
- Former Federal Reserve Bank of New York economist and Salomon Brothers vice chairman, Henry Kaufman
- 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 President of the Federal Reserve Bank of Dallas, Richard Fisher (and see this)
- President of the Federal Reserve Bank of St. Louis, James 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 International Monetary Fund
- 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
- The Director of Research at the Federal Reserve Bank of Dallas, Harvey Rosenblum
- Director, Max Planck Institute for Research on Collective Goods, Bonn, and Professor of Economics, University of Bonn, Martin Hellwig
And the head of the New York Federal Reserve Bank – and former Goldman Sachs chief economist – William Dudley says that we should not tolerate a financial system in which certain financial institutions are deemed to be too big to fail.
Federal Reserve Board governor Daniel Tarullo also backs a cap on the size of banks, and Former Treasury secretary under Reagan and George H.W. Bush, Nicolas Brady, says that we need to put a cap on leverage.
Top Bankers Call for Big Banks to Be Broken Up
While you might assume that bankers themselves don’t want the giant banks to be broken up, many are in fact calling for a break up, including:
- 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)
- Founder and chairman of Signature Bank, Scott Shay
- Former Natwest and Schroders investment banker, Philip Augar
- The President of the Independent Community Bankers of America, Camden Fine
Why do so many top bankers, economists, financial experts and politicians say that the big banks should be broken up?
Because they’re no longer acting like banks, and are destroying the economy.