Sanford Weill, former CEO who helped create CitiBank as one of those "too big to fail" banks, has made a stunning reversal of his position. He was a major force in the repeal of Glass-Steagall, the law that had kept banking and risky investing separated from 1933 until 1999 when it was repealed.
Weill opposed the return of Glass-Steagel type regulations, even during the 2008 crisis; but he now says it's probably time to break up the big banks and separate their banking functions from their speculative investment functions. He says this will avoid the "too big to fail" problem and the risk to taxpayers' money.
Excuse me, but this is exactly what Nobel laureate (liberal) economists Joseph Stiglitz and Paul Krugman have been saying all along. It's the way it used to be until they undid the law that forbade it. And it's one of the main causes of the big melt-down in 2008.
So has Sandy Weill gotten religion, as they say? Is he a "born-again" banker?
Will he now use his Wall St. influence to promote this sensible movement?
Stay tuned.
Ralph
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