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A Wall Street devil gets religion
Hallelujah and Holy Smokes – the biggest sinner on Wall Street has repented!
He is Sandy Weill, the deal-maker who turned our banks into financial "supermarkets" that tie us everyday customers to the profiteering schemes of global speculators.
In the late 1980s, Weill went on a decade-long merger binge, taking over Travelers Insurance, Smith Barney, and several other powerhouses of high finance, culminating in 1998 with his grabbing of Citibank. The empire was named Citigroup, Weill was paid a king's ransom, and he was hailed as a genius. Only one problem: His conglomerated entity was illegal.
After the financial collapse of 1929 led to the Great Depression, the Glass-Steagall Act was passed to protect people's deposits by prohibiting banks from also gambling in stocks, insurance schemes, etc. Picky-picky, said Weill, who simply hired a hoard of lobbyists to get Washington to legalize his illegal structure by repealing the pesky law he was blatantly violating.
In 1999, Congress dutifully nixed Glass-Steagall, and Wall Street promptly rushed to amalgamate more Citigroups, thus creating the "too-big-to-fail" system that – only eight years later – did indeed fail. Weill's "genius" forced a multitrillion–dollar bailout on us taxpayers (including $45 billion for Citigroup itself). By then, though, the genius had retired with so much money he could afford to air-condition hell.
But now – approaching 80 and perhaps hoping to avoid that destination – Weill has suddenly become a born again convert to the gospel of Glass-Steagall, calling for today's megabanks to be "split up" so they are "not too big to fail." Wow – redemption! Note, though, that Saint Sandy is not returning any of the millions he pocketed from his devilish scheme – just in case he really does need to buy that air conditioner.
"The Big Banker's Change of Heart," The New York Times, July 27, 2012.
"Citigroup's ex-CEO does about-face on big banks," Austin American Statesman, July 26, 2012.
"Deal Maker Now Doubts Megabakns," The New York Times, July 23, 2012