If the Banks are too big, and need to be broken up, why aren't they being broken up?

Quote : “It does become difficult for us to prosecute when we are hit with indications that if we do . . . bring a criminal charge, it will have a negative impact on the national economy, perhaps even the world economy,” he said. “It has an inhibiting influence, impact on our ability to bring resolutions that I think would be more appropriate.” Holder added that the geolpolitical implications are a function of the fact that some institutions have become too large. He challenged Congress to do more to address the unwieldy size of financial institutions.

-excerpt from Washington Post

How do you even go about breaking the banks up?

Quote from Slvrshot : -excerpt from Washington Post How do you even go about breaking the banks up?

the same way they broke up at&t back in the day?

It's Official: Too Big to Fail Banks Are Too Big to Jail
http://www.huffingtonpost.com/rob...27372.html

I believe the phrase economists use is regulatory capture. The banks own the regulators and most of the politicians.

Quote from BigBananaMess : I believe the phrase economists use is regulatory capture. The banks own the regulators and most of the politicians.

Only the pols can break up the banks with new legislation.

And being dependent on financiers for campaigns is why they don't do it.

Why break them up? Because they are too big to prosecute? Because we are afraid prosecuting will hurt the economy? What ever happened to principles? These politicians are so afraid that they will get the blame if the economy takes a bump that they wont do the right thing. This is right up there with printing money to inflate the economy. We don't need to shrink them just so they can be investigated and prosecuted. We need backbone to deal with the consequences. Make the punishment strong enough to send a message that isn't quickly forgotten.

Quote from msummers80 : Why break them up? Because they are too big to prosecute? Because we are afraid prosecuting will hurt the economy? What ever happened to principles? These politicians are so afraid that they will get the blame if the economy takes a bump that they wont do the right thing. This is right up there with printing money to inflate the economy. We don't need to shrink them just so they can be investigated and prosecuted. We need backbone to deal with the consequences. Make the punishment strong enough to send a message that isn't quickly forgotten.

I agree with everything you said.

Dangit, I cant find the article now, but an American bank CEO was talking about how, I think it is the Swiss banks, made changes to increase the amount of funds they keep on hand. (ie if a bank has $1000 in customer funds, at any given moment they only actually have a small percentage of that available as funds to give back) The idea was that if these banks had a higher percentage of funds available then the bank would be seen as more stable, and more people would want to invest in that bank.

The American CEO laughed at the idea, citing that he wasn't ever going to have more than the legal minimum required because his bank was so damn big, if the shit hit the fan, the US govt would offer a bailout. And his bank in turn could generate a greater return because more of the funds are available to the bank to be invested.

Because the way they measure companies using Herfindahl–Hirschman Index http://en.wikipedia.org/wiki/Herfindahl_index does not indicate the banks need to be broken up. I think this is a deficiency of HHI rather than an indication the banks are not too concentrated.

Quote from thikthird : the same way they broke up at&t back in the day?

http://videosift.com/video/Colber...he-new-ATT

That worked out so well in the end!

Maybe they are also too big to be broken up.

HarHarhar

No need. The're breaking themselves up. Just like a drunk drinking themselves sober, they're suicidal. And the size of the banks mirrors the unsustainable size of the gvment, ever notice that? It's all collapsing under it's own weight.

Quote from Slvrshot : -excerpt from Washington Post How do you even go about breaking the banks up?

Well, the economy, if we are to believe 124nic8 and Obama was on the verge of collapse just a few years ago. Can't imagine it getting too much worse...

Nonetheless...breakup the banks...uh, no. Let them fail...absolutely.

They should have been allowed to collapse, get rid of all the useless finance majors so the can serve me fries at McD. Replace it with a Federal entity in the short term then privatize this Federal entity into many smaller banks with STRICT rules separating investment banking and commercial banking. They obviously can't be trusted to police themselves, they have had their chances.