Just saw this http://www.telegraph.co.uk/... posted today on a UK newspaper webpage (of all places).
The story says
The call from the 79 year-old will cause a stir on Wall Street and in the City of London because Mr Weill engineered the 1998 deal that made Citigroup the world's largest bank. Hailed at the time, the merger of Citicorp and Travelers Group required the US government to repeal the Glass-Steagall Act, a law dating back to the Great Depression that prevented banks from both taking deposits from customers and gambling on the markets.
So he was for the repeal of Glass-Steagall before he was against the repeal of Glass-Steagall.
This is in the same league as Greenspan admitting a few years ago that he was surprised at how Wall Street types behaved.
Any other "financial geniuses" out there who are ready to eat some crow for thinking they were smarter than years of experience with human nature??
The basic point in my mind is that financial rules are intended to keep some of these egotistical bastards from making calamitous errors that ruin the livelihoods of millions of innocent people who "played by the rules."
Such egregious errors only matter when the institution that these guys are running is big enough to ensnare millions of people who trusted them. When a guy screws up in a modest financial institution, it just gets shut down and the assets get moved to another organization. And the head honcho gets FIRED (hopefully along with all his or her right-hand guys and gals).
We also need bankers to pay into a fund that will reimburse people who are shortchanged by a failing institution. Such payments will rise as the incidences of mal- or mis-feasance increase in value and in number. That might put a damper on irrational behavior by bankers, because when they are viewed as raising other banker's costs, they are likely to get drummed out of the business when they mess up and other others get to cover their losses.
Just one guy's opinion. Your comments?