Political Quotes

“I will speak briefly, and then I will certainly yield to Senator Alexander. I appreciate very much Senator Vitter's words and comments and insight. I wish to expand for 2 or 3 minutes on one thing he said about the subsidy that these largest six banks get. We can see again on this chart that 18 years ago these six banks' total assets were 18 percent; 18 years ago it was 18 percent of GDP. Today, through mergers and growth--and I would argue unfair competition in many cases--they are over 60 percent. But what Senator Vitter said, which I think is important to expand on a bit, is the subsidies these banks get--Bloomberg said it was about $83 billion a year in subsidies they get because of government action or inaction, frankly. It is interesting, that $83 billion, when we are talking about the sequester today is about $85 billion, is not relevant, except putting it in some context. But the reason they have this $83 billion subsidy, $85 billion subsidy or so--$83, $84, $85 billion--or they have the advantage, when they go in the capital markets, of getting the advantage of 50, 60, 70, 80 basis points--and 80 basis points is eight-tenths of 1 percent in interest rate advantage--is because the capital markets believe their investments in these banks are not very risky because the markets believe these banks are too big to fail because they have the government backup for them. So if they have no risk, people are willing to lend money to them at lower interest rates.…”