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Tue Feb 26, 2013, 05:54 PM

Elizabeth Warren, Ben Bernanke Clash Over 'Too Big To Fail' - HuffPo

Elizabeth Warren, Ben Bernanke Clash Over 'Too Big To Fail'
Mark Gongloff - HuffPo
Posted: 02/26/2013 1:44 pm EST | Updated: 02/26/2013 4:33 pm EST

<snip>

Newly minted Sen. Elizabeth Warren on Tuesday showed why big banks are not her biggest fans, grilling Federal Reserve Chairman Ben Bernanke about the risks and fairness of having banks that are "too big to fail." Warren (D-Mass.) questioned Bernanke during his latest semiannual appearance before the Senate Banking Committee to discuss the economy and monetary policy. Warren pressed the Fed chairman about whether the government would bail out the largest banks again, as it did during the financial crisis.

"We've now understood this problem for nearly five years," she said. "So when are we gonna get rid of 'too big to fail?'" Warren also asked whether big banks should repay taxpayers for the billions of dollars they save in borrowing costs because of the credit market's belief that they won't be allowed to fail, repeatedly citing a recent Bloomberg View study estimating that the biggest banks essentially get a government subsidy of $83 billion a year, nearly matching their annual profits.

Though Bernanke questioned the accuracy of the $83 billion figure, he admitted that big banks get some subsidy. But he said the market was wrong to give banks any subsidy at all (in the form of lower borrowing costs), insisting that the government will in fact let banks fail. The 2010 Dodd-Frank financial reform law has given policymakers the tools to safely shut down big, failing banks, he claimed.

But when repeatedly pressed by Warren, Bernanke's confidence seemed to waver. "The subsidy is coming because of market expectations that the government would bail out these firms if they failed," Bernanke said. "Those expectations are incorrect. We have an orderly liquidation authority. Even in the crisis, we -- uh, uh -- in the cases of AIG, for example, we wiped out the shareholders..."

"Excuse me, though, Mr. Chairman," Warren said. "You did not wipe out the shareholders of the largest financial institutions, did you, the big banks?

"Because we didn't have the tools," Bernanke replied. "Now we could -- now we have the tools."

Later, when pressed again by Warren...

<snip>

More: http://www.huffingtonpost.com/2013/02/26/elizabeth-warren-ben-bernanke_n_2766368.html





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Reply Elizabeth Warren, Ben Bernanke Clash Over 'Too Big To Fail' - HuffPo (Original post)
WillyT Feb 2013 OP
gateley Feb 2013 #1
happynewyear Feb 2013 #2
OKNancy Feb 2013 #3
Raine1967 Feb 2013 #21
meow2u3 Feb 2013 #4
Blue Idaho Feb 2013 #5
WillyT Feb 2013 #7
kentuck Feb 2013 #10
malaise Feb 2013 #15
cbrer Feb 2013 #26
MotherPetrie Feb 2013 #29
stlsaxman Feb 2013 #40
meow2u3 Feb 2013 #43
valerief Feb 2013 #42
geardaddy Feb 2013 #45
TwilightGardener Feb 2013 #6
PoliticAverse Feb 2013 #8
fadedrose Feb 2013 #9
AtheistCrusader Feb 2013 #11
Amonester Feb 2013 #38
sulphurdunn Feb 2013 #12
joeunderdog Feb 2013 #27
GoneFishin Feb 2013 #47
riderinthestorm Feb 2013 #13
Volaris Feb 2013 #35
annabanana Feb 2013 #14
lastlib Feb 2013 #17
Jackpine Radical Feb 2013 #24
onethatcares Feb 2013 #16
KoKo Feb 2013 #18
merrily Feb 2013 #34
LittleBlue Feb 2013 #19
bvar22 Feb 2013 #20
Benton D Struckcheon Feb 2013 #22
Liberalynn Feb 2013 #23
WillyT Feb 2013 #25
sheshe2 Feb 2013 #28
WillyT Feb 2013 #30
WillyT Feb 2013 #31
Matariki Feb 2013 #32
colsohlibgal Feb 2013 #33
daybranch Feb 2013 #36
DallasNE Feb 2013 #37
DeSwiss Feb 2013 #39
SemperEadem Feb 2013 #41
reformist2 Feb 2013 #44
Ian_rd Feb 2013 #46
midnight Feb 2013 #48

Response to WillyT (Original post)

Tue Feb 26, 2013, 06:05 PM

1. She sure blew into town ready to kick ass! Again, thank you Massachusetts!

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Response to WillyT (Original post)

Tue Feb 26, 2013, 06:11 PM

2. Very impressive Sen. Warren!!!!



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Response to WillyT (Original post)

Tue Feb 26, 2013, 06:15 PM

3. "clash" is way too over-blown

They were both even tempered and professional. She asked tough questions, he responded and agreed with her on much of what she said.
One thing for sure, anyone up before her committee better be prepared. She is formidable... but not nasty or hateful.

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Response to OKNancy (Reply #3)

Tue Feb 26, 2013, 07:36 PM

21. I agree.

This is wonder to behold. It was not a clash -- it was a line of questioning and answering that has been long overdue.

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Response to WillyT (Original post)

Tue Feb 26, 2013, 06:16 PM

4. Lizzie Warren took an axe

Gave the banksters 40 whacks
When the job was neatly done
Gave Bernanke 41!

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Response to meow2u3 (Reply #4)

Tue Feb 26, 2013, 06:17 PM

5. +1

Brilliant!

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Response to meow2u3 (Reply #4)

Tue Feb 26, 2013, 06:19 PM

7. LOL !!!








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Response to meow2u3 (Reply #4)

Tue Feb 26, 2013, 06:44 PM

10. Brilliant!!

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Response to meow2u3 (Reply #4)

Tue Feb 26, 2013, 07:00 PM

15. Well done

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Response to meow2u3 (Reply #4)

Tue Feb 26, 2013, 09:55 PM

26. Word

 

Warren 2016

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Response to meow2u3 (Reply #4)

Tue Feb 26, 2013, 10:07 PM

29. Internal K&R!

 

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Response to meow2u3 (Reply #4)

Wed Feb 27, 2013, 07:13 AM

40. YEAH!!!

with your permission, of course- i have to use this brilliance!

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Response to stlsaxman (Reply #40)

Wed Feb 27, 2013, 08:52 AM

43. Go ahead and use it

Let's make it go viral!

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Response to meow2u3 (Reply #4)

Wed Feb 27, 2013, 08:47 AM

42. +1000

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Response to meow2u3 (Reply #4)

Wed Feb 27, 2013, 12:13 PM

45. DUzy!

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Response to WillyT (Original post)

Tue Feb 26, 2013, 06:18 PM

6. OK, I would like to officially retire the word "grill" or "grilling" being used in hearings.

Basically any set of questions is now a "grilling". Please make it stop.

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Response to WillyT (Original post)

Tue Feb 26, 2013, 06:23 PM

8. You don't need 'tools' to let banks fail. n/t

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Response to WillyT (Original post)

Tue Feb 26, 2013, 06:25 PM

9. Warren & Kerry suited for their jobs

Warren is combative as a pit bull at hearings, as she should be if she doesn't get the answers she wants. Didn't see her today, but saw her asking why the banks didn't bring Wall Street bankers to trial, and they couldn't answer her either. . That was last week. Hang in there, Liz... Hope to catch it on CSpan.

Kerry is charming and diplomatic from what I saw today, would never insult or demean anyone, and could put his point across using the best and most polite language. He looks like a Secretary of State. I was not too keen on him at first, but looking at the first films from Russia, I think they'll like him and be willing to talk to him and he to them in a frank manner. Good Luck to Kerry...

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Response to WillyT (Original post)

Tue Feb 26, 2013, 06:50 PM

11. Oh sweet shit, there's video too

This is the best thing I've seen all day

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Response to AtheistCrusader (Reply #11)

Wed Feb 27, 2013, 03:31 AM

38. Link to the video here: VVVV

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Response to WillyT (Original post)

Tue Feb 26, 2013, 06:52 PM

12. Warren really should

stay off of small planes.

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Response to sulphurdunn (Reply #12)

Tue Feb 26, 2013, 09:58 PM

27. I wish you were kidding. nt

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Response to joeunderdog (Reply #27)

Wed Feb 27, 2013, 01:14 PM

47. I wish you were kidding too. Too many aviation coincidences to ignore.

But that is another discussion.

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Response to WillyT (Original post)

Tue Feb 26, 2013, 06:58 PM

13. He really had NO answers. Wow! I had no idea he would be so badly exposed.

More from the article...

"Some of these rules take time to develop -- um, uh, the orderly liquidation authority, I think we've made progress on that," he said. "We've got the living wills -- I think we're moving in the right direction ... We do have a plan, and I think it's moving in the right direction."

"Any idea about when we're gonna arrive in the right direction?" Warren said.

"It's not a zero-one kind of thing," Bernanke stammered in response. "Over time we will see increasing, uh, increasing market expectations that these institutions can fail."

snip

Bernanke suggested that banks would eventually lose some of the benefits of size and would shrink themselves voluntarily -- news that might surprise JPMorgan Chase CEO Jamie Dimon, who was again extolling the benefits of his bank's size even as Bernanke spoke.




Yeah, Jamie Dimon's gonna VOLUNTARILY shrink JPMorgan Chase??



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Response to riderinthestorm (Reply #13)

Wed Feb 27, 2013, 01:31 AM

35. Bernanke and Timmy are the guys who know how "to make the planes land on time", so to speak..

the problem (as I see it) is that America REALLY expected to get a High-Speed Rail System out of this whole thing. They are not bad at the jobs they HAVE, they just suck at the jobs we want them TO BE DOING. Good on Liz for making that obvious.

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Response to WillyT (Original post)

Tue Feb 26, 2013, 07:00 PM

14. Hoo Boy.. Check out Bernanke on things banks might do, you know,

just because.. Maybe out of the goodness of their hearts?

Bernanke suggested that banks would eventually lose some of the benefits of size and would shrink themselves voluntarily -- news that might surprise JPMorgan Chase CEO Jamie Dimon, who was again extolling the benefits of his bank's size even as Bernanke spoke.


Got that?.... "voluntarily"


Yeah,
.
.
.
sure.

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Response to annabanana (Reply #14)

Tue Feb 26, 2013, 07:09 PM

17. ...



(gonna need more popcorn, I think that's gonna be a long show.............)

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Response to lastlib (Reply #17)

Tue Feb 26, 2013, 09:26 PM

24. Wow, that's it. Buy popcorn futures!!1!





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Response to WillyT (Original post)

Tue Feb 26, 2013, 07:05 PM

16. I just heard snippets of Bernanke

and my first thought was, "what a bullshitter. I could gobbledeegook some thing up and say it too, not that it would make any sence".

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Response to WillyT (Original post)

Tue Feb 26, 2013, 07:10 PM

18. I was cautious about Elizabeth Warren...but..she's DOING GOOD!

So many that we gave funds to in US Senate turned out to be "Weak Toasts that we started to give up hope!

Sheldon Whitehouse (who just appeared with the "Anti-Fracking Protests" and Elizabeth Warren who "hit the ground running" are the Heroes..for me...for now. I hope the will keep up the GOOD FIGHT and not get Co-OPTED like Sheldon did for years under the Senate Rules of being a "GOOD FELLOW TO GET ALONG."

And the shorter Harry Reid's stay as LEADER OF SENATE IS...the happyier Democrat this VOTER WILL BE!

That said: Liz Warren was a very good PICK!

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Response to KoKo (Reply #18)

Wed Feb 27, 2013, 01:09 AM

34. IMO, Warren is one of the best we have.

However, I am still cautious.

Grilling a witness is one thing; voting and writing legislation and getting it passed are others.

Grilling a witness gets her some personal props. (Not that there's anything wrong with that. IMO, so far, she deserves them.) But, will she vote with her caucus no matter what? Will she be mostly a gadfly who doesn't get legislation passed--legislating beign the main job of a legislator (though oversight is important).

It's not that I have doubts about Warren's motives or integrity, so far. It's that they system, as it currently stands, is stacked.

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Response to WillyT (Original post)

Tue Feb 26, 2013, 07:16 PM

19. Think I'm in love



Whenever she runs for prez, she can count on me. And I'm sure a few million others.

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Response to WillyT (Original post)

Tue Feb 26, 2013, 07:21 PM

20. DURec for Senator Warren.

The only problem I have is that this is so remarkable.
She is a DEMOCRAT doing her JOB,
and everybody is all "WOW!!!! That was SOMETHING you don't see every day!!!!"

Every Single Elected Democrat should be doing this Every single day.
What Elizabeth Warren did today should be boring.


Nothing but LOVE for Senator Warren from this old FDR Democrat!



You will know them by their WORKS,
not by their rhetoric, promises, or excuses.
Solidarity99!
--------------------------------------------------------------------------------------------------------------------------------

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Response to WillyT (Original post)

Tue Feb 26, 2013, 08:05 PM

22. As you can see by my sig...

...I'm hardly a fan of the Fed.
The test of whether they mean it or not re letting big banks fail is this: look at what they did when that money market fund, the Reserve Fund, failed after the Lehman collapse. They went in and guaranteed ALL money market funds.
That wasn't the first time. The first time was way way back in the early 70s. So they had 40 some odd years to figure out what to do with money market funds, and all they could come up with when the problem recurred was to guarantee them again, which is to say, make explicit an implicit gov't guarantee of money market funds, which basically means if you can issue commercial paper you get that implicit gov't guarantee for your borrowing costs. This is part of the subsidy the big banks get, because ONLY the big banks can issue commercial paper and get it bought in the open market by third parties.
The better answer is to make it explicitly clear money market funds won't be saved and aren't the equivalent of FDIC insured deposits. And then PROVE it by their actions.

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Response to WillyT (Original post)

Tue Feb 26, 2013, 08:36 PM

23. I love Elizabeth Warren

I just wish that someday I could call her Madame President!

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Response to WillyT (Original post)

Tue Feb 26, 2013, 09:34 PM

25. Kick !!!


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Response to WillyT (Original post)

Tue Feb 26, 2013, 09:59 PM

28. Please, Proceed Senator!!!!

That's our Senator!

Thanks WillyT.

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Response to WillyT (Original post)

Tue Feb 26, 2013, 10:34 PM

30. Um... Kick ???


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Response to WillyT (Reply #30)

Tue Feb 26, 2013, 11:37 PM

31. Hell Yeah... KICK !!!!


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Response to WillyT (Original post)

Tue Feb 26, 2013, 11:56 PM

32. It's awesome that she was given a seat on the Banking Committee

Especially as a freshman Senator. She definitely deserved it.

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Response to WillyT (Original post)

Wed Feb 27, 2013, 12:45 AM

33. You Go Elizabeth, Keep Rocking the Bankster's World!

She is awesome and the though of maybe Ashley Judd joining her to help going after Wall Street/Crony Capitalism really excites me.

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Response to WillyT (Original post)

Wed Feb 27, 2013, 02:17 AM

36. same as sequester cut or about?

Dems should propose eliminating that $83 billion subsidy and using it for the services planned to be cut for the sequester. I am sure most citizens would agree. Why would this not work? Please tell me, Senator Warren.

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Response to WillyT (Original post)

Wed Feb 27, 2013, 03:23 AM

37. Contrast That With The Exchange With Sen. Bob. Corker

Corker made a rambling statement then when he finally allowed Bernanke to speak the first words out of Bernanke's mouth were "everything you just said is inaccurate" then started with his prepared answer. Corker could be heard talking over Bernanke with a meek "that's not true".

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Response to WillyT (Original post)

Wed Feb 27, 2013, 04:48 AM

39. Maybe you'll note the small anatomical flaw in this brass bull's ass......

...in that he's got no anus. So there's no way for the bull to get the shit out, except when Bernanke goes to Congress and opens up his piehole.



- On Wall Street if you don't hear the bullshit coming from the mouth, it's still inside the asshole.....

K&R

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Response to WillyT (Original post)

Wed Feb 27, 2013, 07:18 AM

41. I want to see hank paulson dragged in front of her

and also tim geithner...

before they're frog marched off to prison.

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Response to WillyT (Original post)

Wed Feb 27, 2013, 08:53 AM

44. Earth to Tea Party: If you weren't such fatheads, you'd support Liz Warren!

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Response to reformist2 (Reply #44)

Wed Feb 27, 2013, 12:19 PM

46. The Tea Party would love her if their concerns were genuinely about government waste.

But, yea, we know better. It's all about gays, evolution, and their trained worship of the Rich, no matter how much tax-payer welfare the Rich consume.

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Response to WillyT (Original post)

Wed Feb 27, 2013, 01:18 PM

48. Repaying the taxpayers would be a great start.... But I've heard this banking story told that the

underwater mortgages were payed off via the loaned money to the banks.... So what is to be done about that? States like Wisconsin is having that money used to plug other expenses endured by the Walker administration...

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