Bill Dudley On Breaking Up Too Big To Fail Banks: "Don't"

Tyler Durden's picture

In a day full of "shocking" announcements, we just got the latest one. Because it must be truly a shock that none other than Goldman's Bill Dudley, who also moonlights as head of the New York Fed, is stoically against the break up of America's systemically critical, massive and 100% untenable FDIC-insured hedge funds, pardon megabanks. Such as Goldman.

From a just released speech ironically titled "Too Big To Fail"

I am not yet convinced that breaking up large, complex firms is the right approach.  In particular, these firms presumably exist, in large part, because there are scale or network effects that allow these firms to offer certain types of services that have value to their global clients.  These benefits might be lost or diminished if such firms were broken up.  In addition, the costs incurred in breaking up such firms need to be considered.  Finally, the breakup of such firms would not necessarily result in a significant reduction in overall systemic risk if the resulting component firms were still, collectively, systemic. 

That is so wrong and frankly moronic, as to border on the grotesque.

These megabanks only exist because the regulatory and financial climate in the US (and the entire world) is one which promotes consolidation to such a point where it is in every bank's best interest to become as big and as systematically critical as possible in the shortest amount of time, and thus to always get bailed out whenever it is threatened with that other part of the Return equation: Risk.

For Dudley to not even remotely admit this is disingenuous, naive and frankly, idiotic.

The remainder of the Bill "just eat hedonic iPads" Dudley's drivel can be found here.

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digitlman's picture

Fuck Bill Dudley.


Up the ass.



With a SCUD missile.

jbvtme's picture

"NELL...I can't beelieve it!"  Dudley DooRight

Manthong's picture

The gent has earned pole position..

in the guillotine line.

'tis a far, far better thing we do to him..

jbvtme's picture

does anyone know if you can make thumb screws with a 3D printer?

Xibalba's picture

Tres. Sec in waiting...

Steve in Greensboro's picture

TBTF banker says "...I am not yet convinced that breaking up large, complex firms is the right approach...."

Fully agree.  Who is going to decide how the breakup should be structured?  Obama?  Give me a break.

But in the next crisis every bank gets the Lehmann treatment.

James_Cole's picture

Finally, the breakup of such firms would not necessarily result in a significant reduction in overall systemic risk if the resulting component firms were still, collectively, systemic. 


nope-1004's picture

Someone fill me in.  Who is Bill Dudley and what importance does he have to my suffering town?  Does he make clean water?  Does he create manufacturing jobs?  Does he provide essential services to seniors?

Please forgive my ignorance.  Since he said something in the media, he must be important to the millions on food stamps, millions unemployed, and thousands of small businesses that are closing annually.




FEDbuster's picture

I switched all of my accounts from TBTF/TBTJ banksters in 2009.  Boycott the fuckers.  Remember if we are on a gold or silver standard, you can can buy as much as you want with your FRN's at a rate of $1306 and $21 per troy oz.  Fuck the FED and their fiat toilet paper.

Herd Redirection Committee's picture


Centralization causes too much power to go into too few hands, hands which are then corrupted, fucking the entire system. 

BigJim's picture

Dudley left it a bit late to make his Fed chairman election campaign speech, didn't he?

Richard Chesler's picture

In-your-face, Obozo style corruption.

Nigh Eve's picture

He is a naive ivory-tower inflationist.  

Cacete de Ouro's picture

It's a G30 world

And here are the rest of the nest of Vipers
Including Carney
and Mario
and Larwyy

G30, we like to control the IMF also, and the World Bank and IFC, that's why we have the same office suite and even the same fax number as that other major front / lobbyist, The Bretton Woods Committee

The Bretton Woods Committee
1726 M Street, NW, Suite 200
Washington, DC 20036, USA
Fax 202-785-9423

Group of 30,
1726 M Street, NW, Suite 200
Washington, DC 2003, USA
Fax 202-785-9423

We don't even have to put an NSA tap on the fax machine, we just read the eh?

Four chan's picture

lets see, the banks own nothing but debt created out of thin air and are completely

insolvent since having ditched mark to market,

it seems to me they are already broken up in the sence they hold essentially nothing real or secure.

Cthonic's picture

Nice tits, though brains they are not.

Go see what those insolvent entities sucked out of thin air in the way of compensation in the past five years of non-lending.  That's a trick only a TBTF can pull off.

BigJim's picture

In exchange for all that thin-air money, the banks have claims on probably 25% of the world's wealth.... and will seize it if their debtors can't pay off.

Pretty good racket if you ask me.

slotmouth's picture

They exist because assholes like you keep bailing them out!

ajax's picture



Ok Mr. Dudley we get it: status quo. Next bailout will be 100% financed by you and all your fellow banksters. Your salaries, bonuses, art collections, cars, yachts, planes, real estate etc.

Is that a fair deal?

ArkansasAngie's picture

Dudley just confirmed that the "market" infrastructure is a public utility and a not for profit manipulative corruption vehicle

It isn't a rent extraction tollway for parasites

sgt_doom's picture

I too am shocked that Billy Dudley, member of the Group of Thirty, founded by the Rockefeller Foundatin in 1978 to speak on behalf of the central banksters and speculators, would suggest such a thing.  (Disclaimer:  personally sd believes they should be razed to the ground, allowing nothing living to be left of them!).

And what a charming bunch they (Krugman, Summers, Draghi, Trichet, barf, barf, barf, ...) are:

(Let's hear it for those Rockefellers, owners of so much, and former owners of the Warren Commission and Allen Dulles and John McCloy!)

HardAssets's picture

Goldman + NY Fed = B.S.

I don't even bother reading what comes from a source like that.

Magnix's picture

Good time for bank run?

Stoploss's picture

Oh, well that will take care of itself when treasury's collapse.


LawsofPhysics's picture

Yes, that or the supply lines for essential commodities breaks < SNAP > at which point, and only at this point does "shit get real".

Same as it ever was.

rtalcott's picture

Make simple concepts complex and complex problems's a great strategy to confuse the issue.

MrPoopypants's picture

I don't want .gov breaking them up. I want a free market to do it as it should be.

NOTaREALmerican's picture

Is a "free" market free enough to be manipulated by really smart-n-savvy people resulting in a less than "free" market, or is there something about a "free" market that keeps the smart-n-savvy people from manipulating it?

A Lunatic's picture

Reintroduce equal treatment under the law and see what the fuck happens to TBTF........

NOTaREALmerican's picture

Is "the law" just something the adults tell bullshit stories to the children about, while the adults prove they are adults by working out creative ways to avoid "the law"?

A Lunatic's picture

Sadly, this is the result of the application of situational ethics (among other things) on a national scale. The fact that some get a pass while others must pay in full is due to government meddling and corporate greed, not 'free markets' or 'capitalism' as the propagandists would have you believe. We have petty thieves doing lengthy prison sentences while the criminal elite enjoy positions of power and authority over the citizenry. Can you not see this?

NOTaREALmerican's picture

Re:  Can you not see this?

And can you not see that the difference between an adult and a child is in living a duplicitous life.

Duplicity is the key to success, and self-delusion is the key to happiness.

The adults manipulate the children with bullshit about "laws" and "morals".   Some children never figure things out.

Duplicity, ask for it by name!

Herd Redirection Committee's picture

Defeatism, brought to you by NOTaREALmerican.

BigJim's picture

He'd make a great teammate/friend/spouse wouldn't he?

NOTaREALmerican's picture

Re:  He'd make a great teammate/friend/spouse wouldn't he?

I didn't say I like or support it.  I'm just telling what the reality of humans is.  

If you want to believe some bullshit about reality that's fine with me, most people do.

NOTaREALmerican's picture

Re:  Defeatism, brought to you by NOTaREALmerican

Point me to an ISM that deals with humans as sociopaths.   None of the ISM do:  Libertarianism, socialism, communism, & capitalism can't deal with the end-game caused by the sociopaths simply manipulating - and eating the dumbasses alive - with bullshit.

Bullshit, ask for it by name!

The Axe's picture

Go choke on a IPAD


LawsofPhysics's picture

So don't break them up, clear them the fuck out...

roll the motherfucking guillotines and sever some fucking heads restoring real consequences for bad behavior.  Be sure to have those guillotines roll right on down to K-street and also put an end to the gross mis-allocation and mal-investment of capital and resources once and for all.  Nothing changes otherwise...

TheReplacement's picture

You could kill all the bankers and you would be ignoring the problem.  The problem stems from our government representing big money interests instead of us the people.  Fix that first.  The bankers will be solved naturally after that.

NOTaREALmerican's picture

Show of hands of all the OldFarts and NearOldFarts who were having "free enterprise" orgasms a few decades ago when TPTB were telling us that the US banks couldn't complete in "the world economy" and had to be allowed to merge so that "free enterprise" could flourish in the world and Merican banks would be able to lead this great-n-glorious country to greater greatness and gloryness.

Yeah, me too.   Humans worship people in nice suits.

LetThemEatRand's picture

What they meant is that it would lead the population to being reduced to trying to make money working a glory hole, so they were kind of right.

chunga's picture

"Finally, the breakup of such firms would not necessarily result in a significant reduction in overall systemic risk if the resulting component firms were still, collectively, systemic." 

What an asshole this Dudley jerk is. Fuck him is right. Fuck you Dudley. Fuck you.


ejmoosa's picture

Too Big to Function....

NOTaREALmerican's picture

Re:  Too Big to Function

Well, they function pretty well at moving loot to the top 10%.  

bearish1's picture


RockRiver's picture

Quoted from my DOW news feed:


Fed's Dudley: Sees 'Deep Seated' Cultural, Ethical Lapses at Many Financial Firms


Really? I'm shocked.

Dollar Bill Hiccup's picture

In the 90s, around crises like Peso Crisis, Asian Crisis, Russian Crisis, LTCM, equity markets still were compounding at incredible rates.

At that time, emerging market oligopolies were seen as attractive yet dangerous competitors.

Hyper leveraged European banks were seen as role models for American banks to be protectors of American Financial Empire and the reserve currency.

Hence, Glass Steagall's repeal allowed large banks to use their balance sheets aggressively, and it put a nail in the coffin of the Broker Dealers in the end ... Merrill, Lehman, Bear etc.

So of course Dudley wants TBTFs. That was the whole point for these guys, to create Leviathan.

fonzannoon's picture

Bill Dudley knows everyones shit's emotional right now.

jefe95's picture

circular logic is circular