Too big

The NYT has a good piece on the prospects for federal breakups of the big banks.  It’s not part of the financial reform bill that the Senate Finance Committee just passed, or the one the House passed earlier, but a group of Democratic senators including Sherrod Brown of Ohio and Ted Kaufman of Delaware just introduced such a measure.

Some numbers to sink your teeth into, from the article:

The banking industry has become much more concentrated as it has grown in recent years. In 1995, the assets of the six largest banks were equivalent to 17 percent of G.D.P.; now they amount to 63 percent of G.D.P. Meanwhile, the share of all banking industry assets held by the top 10 banks rose to 58 percent last year, from 44 percent in 2000 and 24 percent in 1990.

UPDATE: Simon Johnson likes the Kaufman-Brown bill and discusses it at length here.  A longer post here about the specious arguments by two senators and Larry Summers in favor of preserving the size of the big banks.


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