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Fed Reserve Bank of Dallas: Break Up The Big Banks
Former Secretary of Labor under the Clinton Administration Robert Reich told of a surprising and interesting report by the Federal Reserve Bank of Dallas in his opinion piece on Marketplace, April 4, 2012. The report by one of the more conservative banks in the Federal Reserve system (Is it? Kim, do you know if this is true?) called for an immediate end of "Too Big To Fail" (TBTF) lest we face another financial crisis similar to the one in 2008 and yet another bailout. The president of the Dallas Fed, Mr. Richard W. Fisher, wrote in his introductory letter of the report,
"... The TBTF institutions that amplified and prolonged the recent financial crisis remain a hindrance to full economic recovery and to the very ideal of American capitalism. It is imperative that we end TBTF. In my view, downsizing the behemoths over time into institutions that can be prudently managed and regulated across borders is the appropriate policy response. ..." ("Choosing the Road to Prosperity", 2011 Annual Report Federal Reserve Bank of Dallas, p.1)
Admittedly, this report is not the kind of thing that makes for interesting bedtime reading unless, of course, you are an economics geek. (I'm not) But, it is worth your time reading. The author of the report, Mr. Harvey Rosenblum, concludes with:
As to my opinion on the conservatism of the Dallas Fed, I hesitate to make an overall call because I'm really only familiar with the Dallas and New York systems; not familiar with the other ten to make a comparison.
I will say, however, that the Dallas Fed isn't as conservative as some might assume just because it's in a red state. The current president - Richard Fisher who you cited above - served as assistant to the Treasury Sec'y under Carter for example.
Another issue: it's quite possible that some of the board members are indeed conservative old-school bankers from smaller banks. If that's the case, bankers in small and mid sized banks would very likely also support breaking up big banks for many reasons.