Congress Has Lost Control of the Big Banks
By Pam Martens
August 19, 2013
On January 16 of this year, Richard Fisher, President of the Federal Reserve Bank of Dallas, delivered a speech on the continuing threat to the U.S. economy posed by the too-big-to-fail banks. Fisher said: “I submit that these institutions, as a result of their privileged status, exact an unfair tax upon the American people. Moreover, they interfere with the transmission of monetary policy and inhibit the advancement of our nation’s economic prosperity.”
As part of his talk, Fisher presented a chart showing the Frankenbank nature of the five largest banks in the U.S. – JPMorgan, Bank of America, Goldman Sachs, Citigroup, and Morgan Stanley. Cumulatively, these five banks are the parent to 19,654 subsidiaries or affiliates while their nondeposit liabilities total over $4.1 trillion – a figure equal to 26.3 percent of the Gross Domestic Product (GDP) of the country.
On July 23, 2013, the Senate Banking Subcommittee on Financial Institutions and Consumer Protection, chaired by Senator Sherrod Brown, held a hearing titled: “Examining Financial Holding Companies: Should Banks Control Power Plants, Warehouses, and Oil Refineries?” (Hopefully, that was simply a rhetorical question.)
At the hearing, Timothy Weiner, Global Risk Manager of the giant beer brewer, MillerCoors LLC, told the Senate subcommittee that the largest U.S. banks had gained “effective control” of the London Metals Exchange (LME) and were using their cartel powers to hold up deliveries of aluminum and push up its price.