In Defining Hypocrisy, Weill, Who Led Repeal Of Glass Steagall, Now Says Big Banks Should Be Broken Up

Tyler Durden's picture

Who is Sandy Weill? He is none other than a retired Citigroup Chairman, a former NY Fed Director, and a "philanthropist." He is also the man who lobbied for overturning of Glass Steagall in the last years of the 20th century, whose repeal permitted the merger of Travelers of Citibank, in the process creating Citigroup, the largest of the TBTF banks eventually bailed out by taxpayers. In his memoir Weill brags that he and Republican Senator Phil Gramm joked that it should have been called the Weill-Gramm-Leach-Bliley Act. Informally, some dubbed it “the Citigroup Authorization Act.” As The Nation explains, "Weill was instrumental in getting then-President Bill Clinton to sign off on the Republican-sponsored legislation that upended the sensible restraints on finance capital that had worked splendidly since the Great Depression." Of course, by overturning Glass Steagall the last hindrance to ushering in the TBTF juggernaut and the Greenspan Put, followed by the global Bernanke put, was removed, in the process making the terminal collapse of the US financial system inevitable. Why is Weill relevant? Because in a statement that simply redefines hypocrisy, the same individual had the temerity to appear on selloutvision, and tell his fawning CNBC hosts that it is "time to break up the big banks." That's right: the person who benefited the most of all from the repeal of Glass Steagall is now calling for its return.

Hypocrisy defined 5:20 into the interview below:

I am suggesting that [big banks] be broken up so that the taxpayer will never be at risk, the depositors won't be at risk, the leverage of the banks will be something reasonable... I want us to be a leader... I think the world changes and the world we live in now is different from the world we lived in ten years ago.

How ironic is it then that at the signing ceremony of the Gramm-Leach-Bliley, aka the Glass Steagall repeal act, Clinton presented Weill with one of the pens he used to “fine-tune” Glass-Steagall out of existence, proclaiming, “Today what we are doing is modernizing the financial services industry, tearing down those antiquated laws and granting banks significant new authority.”

How ironic indeed. And how hypocritical for this person to have the temerity to show himself in public, let alone demand the law he ushered in, be undone.

Weill discussing all of the above and more with a straight face here:

For those curious to learn a bit more about Weill, here is some good reading:

Weill is the Wall Street hustler who led the successful lobbying to reverse the Glass-Steagall law, which long had been a barrier between investment and commercial banks. That 1999 reversal permitted the merger of Travelers and Citibank, thereby creating Citigroup as the largest of the “too big to fail” banks eventually bailed out by taxpayers. Weill was instrumental in getting then-President Bill Clinton to sign off on the Republican-sponsored legislation that upended the sensible restraints on finance capital that had worked splendidly since the Great Depression.


Those restrictions were initially flouted when Weill, then CEO of Travelers, which contained a major investment banking division, decided to merge the company with Citibank, a commercial bank headed by John S. Reed. The merger had actually been arranged before the enabling legislation became law, and it was granted a temporary waiver by Alan Greenspan’s Federal Reserve. The night before the announcement of the merger, as Wall Street Journal reporter Monica Langley writes in her book “Tearing Down the Walls: How Sandy Weill Fought His Way to the Top of the Financial World... and Then Nearly Lost It All,” a buoyant Weill suggested to Reed, “We should call Clinton.” On a Sunday night Weill had no trouble getting through to the president and informed him of the merger, which violated existing law. After hanging up, Weill boasted to Reed, “We just made the president of the United States an insider.”


The fix was in to repeal Glass-Steagall, as The New York Times celebrated in a 1998 article: “…the announcement on Monday of a giant merger of Citicorp and Travelers Group not only altered the financial landscape of banking, it also changed the political landscape in Washington.... Indeed, within 24 hours of the deal’s announcement, lobbyists for insurers, banks and Wall Street firms were huddling with Congressional banking committee staff members to fine-tune a measure that would update the 1933 Glass-Steagall Act separating commercial banking from Wall Street and insurance, to make it more politically acceptable to more members of Congress.”


At the signing ceremony Clinton presented Weill with one of the pens he used to “fine-tune” Glass-Steagall out of existence, proclaiming, “Today what we are doing is modernizing the financial services industry, tearing down those antiquated laws and granting banks significant new authority.” What a jerk.


Although Weill has shown not the slightest remorse, Reed has had the honesty to acknowledge that the elimination of Glass-Steagall was a disaster: “I would compartmentalize the industry for the same reason you compartmentalize ships,” he told Bloomberg News. “If you have a leak, the leak doesn’t spread and sink the whole vessel. So generally speaking, you’d have consumer banking separate from trading bonds and equity.”


Instead, all such compartmentalization was ended when Clinton signed the Gramm-Leach-Bliley Act in late 1999. In his memoir Weill brags that he and Republican Senator Phil Gramm joked that it should have been called the Weill-Gramm-Leach-Bliley Act. Informally, some dubbed it “the Citigroup Authorization Act.”


Gramm left the Senate to become a top executive at the Swiss-based UBS bank, which like Citigroup ran into deep trouble. Leach—former Republican Representative James Leach—was appointed by President Barack Obama in 2009 to head the National Endowment for the Humanities, where his banking skills could serve the needs of intellectuals. Robert Rubin, the Clinton administration treasury secretary who helped push through the Citigroup Authorization Act, was the most blatant double dealer of all: He accepted a $15-million-a-year offer from Weill to join Citigroup, where he eventually helped run the corporation into the ground.


Citigroup went on to be a major purveyor of toxic mortgage–based securities that required $45 billion in direct government investment and a $300 billion guarantee of its bad assets in order to avoid bankruptcy.


Weill himself bailed out shortly before the crash. His retirement from what was then the world’s largest financial conglomerate was chronicled in the New York Times under the headline “Laughing All the Way From the Bank.” The article told of “an enormous wooden plaque” in the bank’s headquarters that featured a likeness of Weill with the inscription “The Man Who Shattered Glass-Steagall.”

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cossack55's picture

The scumbag would have been much more palatable had his tie been made of hemp.

Short Memories's picture

Put him in stocks in the town square so we can spit and throw fruit at him!

max2205's picture

He's trying reverse psychology on us.

economics9698's picture

Glass-Steagall was a payback by the Rockefellers against the Morgans for the Sherman and Clayton anti trust acts of 1890 and 1914.

It has nothing to do with nothing.  The TBTF problem SHOULD have been solved in 2008 with the bankruptcy of all the TBTF banks. 

Problem over, decentralized banking.

Glass-Steagall is a red herring, ignore it and this creep.

Glass-Steagall would have made no difference in the housing boom and bust.  The boom was caused by Alan Greenspan’s 1% fed funds rate in 2003-04.

strannick's picture

Guy reminds me of Soros, gettin ''all humanitarian'' after relieving Britain of a Billion dollars..., or Greenspan talking about ''too much debt''. I guess Judas Iscariot offering to return the money after the deed is the ultimate example

Hard1's picture

And the cynical asshole award of the year goes to....

Stackers's picture

It was Bush deregulations that collapsed the system ....... oh wait. Clinton ? What did he do ?

sqz's picture


You are completely missing the point.

The banks became TBTF due to lack of compartmentalization, deregulation of banking (since 80's) and lack of oversight of all banking activities (started with birth of shadow banking in early 60's [1]).

Once they became TBTF not bailing them out was simply out of the question. That's what Too Big To Fail means. It is not a political term, though it is catchy enough to seem like it. It does not matter where you are on the political, economic or business spectrum, if entities known officially known as Systemically Important Financial Institutions [2] or, even worse, the corporations who backed some of their largest and most leveraged trades, e.g. AIG, were allowed to fail, the interconnectedness of the system would mean that one failure would risk, nay cause, the whole financial system to collapse.

The collapse does not even need to be for a long time, the damage could be so large with even a short collapse that it would take an inordinate amount of time to recover from it and risk permanent structural damage to real economies.

If you think all these consequences are somehow made up, then you must have missed the whole Lehman "experiment" and were asleep in 2008.

If you think who does the bailouts or bailins or however else spends public money post-crises is more important than fixing the causes of the crises, then no one can help you...

Just think: even if successive large government spenders (wars and benefit systems etc) and continunous money printing by central banks had occurred as is usual, if the banks had been able to fail like any other business as a consequence of taking excessive risk, then there would have been no systemic crises. The failures would have been spread across a larger number of actors, like the old Savings and Loans crises. From those focussed and relatively small private wealth destructions, there would have arisen opportunities for others to step in and the consequences would have been very temporary, especially for the real economy. Instead, the West, if not the world is now facing 20+ years of stagnation due to locked up useless paper, excess liquidity to stem the worst of the pain, and highly corrupt excessively important institutions which cannot be easily reformed let alone removed setting us up for the next inevitable crisis.

Compartmentalization, which should be greatly more restrictive than Glass-Steagal (but at least that was a final barrier), is the ONLY way to begin to sever the interconnectedness of large speculative actors, like you see from investment banking, from the real economy. Unlike hedge funds, investment banks cannot currently fail without affecting everyone else permanently. This MUST change or more, higher damage and more frequent crises will keep occuring.

[1] Shaxson, "Treasure Islands":

[2] Financial Stability Board, SIFI:

LetThemEatRand's picture

Economics9698 is a government contractor who bitches about paying taxes.  He is one of those guys who screams all day long that government is bad while he feeds from the government trough.  He is against regulation because his religion is that all things government are bad (except his pay check).  The facts are completely irrelevant to him.      

Divided States of America's picture

What did you expect from another conniving deceit Jew who works on Wall Street? I dont expect anything less given how they have infiltrated the top positions of 90% of American financial institutions.

economics9698's picture

For every action there is a equal and opposite reaction.

Antifaschistische's picture

BINGO....If the Market were allowed to do SOME of it's work the TBTF Banks WOULD be broken up.   How about closing the "discount window" at the Fed!!   Or how about opening up the "discount window" at the Fed to ALL "big boys" with enough cash to satisfy Fed minimums!  

Breaking UP the banks must be done by tearing DOWN the Fed.   Then caveat emptor.

economics9698's picture

Get over Glass-Stegall, its a BS issue.  The problem is the Federal Reserve.


LoneStarHog's picture

Bullshit! ... That is like saying that the problem is AIDS, while ignoring the HIV virus.

economics9698's picture

The Fed is the dick that spreads the virus.

dirtbagger's picture

Repeal of Glass Steagall was just a formality to make investment banking activities appear legal in print.  There were already so many loop holes in Glass-Steagal legislation prior to final repeal it looked like swiss chese.  The repeal was just the final death rattle of the pretend Chinese wall and allowed Citi to acquire Travelers.

It doesn't matter what legislation is passed when the revolving door regulators are owned by the financial elite and there is zero enforcement and oversight.  Makes the Corleone family look like a bunch of pikers. 

Dingleberry's picture

Glass Stegall allowed these guys to lever to the is that not part of the problem?

economics9698's picture

And who bailed out the TBTF banks?

The They's picture

When he credited our financial system for "lifting a billion people out of poverty" and leading the east out of communism i spit my coffee at my screen in surprise and disgust.

LoneStarHog's picture

Will Barney Frankfurter qualify under the latter?  I would like to throw Barney at him, bottom first. Two f__king maggots!

gmrpeabody's picture

Well..., he just set us all straight on CNBC by saying the repeal of Glass/Stegal didn't allow the banks anything new. That it was aimed at insurance companies. Maybe he's working on his legacy.

buzzsaw99's picture

That this scumbag can slither out of the woodwork without fear shows all that is wrong with the world.

Doomer's picture

Better yet, roasted on a spit with an apple in his mouth.

Dugald's picture

How can you revile him, he is YOU! just another good ol boy...a red blooded American proud of the flag who made heaps...the American way, money before and above all. But now the leopard is changing his spots before its too late...he hopes, in case someone wants to decorate a tree with him, and lets not forget all those like him.

phalfa5's picture

He's just jealous that he is not in on the game (take)

Payable on Death's picture

He's a hypocrite, for sure. But, he's right about breaking up TBTF. The problem is he's using the same excuse then as now: "To make America competitive." That, er, principle is malleable.

Bob's picture

Patriotism is the last refuge of a scoundrel.  As if these mother fuckers have any meaningful attachment to anything this country has ever stood for or been except a resource to be strip mined by any and every means possible.  Cocksuckers. 

But appeals to patriotism are the rage today.  Hum the right tune and salute the flag and you've got a ready army of useful idiots to run interference while the money boyz and their pet tools get the job done just the way you need it.

Same shit, different day.  Predatory parasites as success stories blessing us with their guidance. Pathetic. 

battle axe's picture

Hey Sandy, how is your drug addict son doing these days you piece of shit. 

overmedicatedundersexed's picture

rats run for cover with any sun light..maybe he thinks the mobs  with pitch forks are around the corner of wall st.

ghengis86's picture

I'm convinced that only pitch forks, torches, tar, feathers and public hangings will be the solution to this mess.  Until that day comes, nothing will change and our only outlet will be venting on some intertube forums...fucking hate these fucking pieces of shit

gmrpeabody's picture

Somebody woke up on the wrong side of the bed...

ghengis86's picture

Lol...seems to be happening a lot lately since the first place I check for news is ZH in the morning.  It's a good pre-antidote for all the bullshit I'm going to be bombarded with throughout the day. 

Doomer's picture

Sounds like he woke up the right side to me!

azzhatter's picture

You are correct. Only a violent revolution changes things now. The people have no other weapons left, the ballot box is a joke

KNiCKER's picture

It's just depressing... All lower and middle class workers are crunched, these crookes benefit and get some airtime as well to pretend they want things to be 'fixed'...



Bob's picture

But he wants to "make America competitive!"  It brings tears to my eyes . . . we've been needing guys like him for a long time. 

Better get him in a position of real influence ASAP. 

A sixteen year old who has consentual sex with a fifteen year old is barred from meaningful contact with children for twenty five years after release from prison and is a pariah wherever he goes. 

But being a rich gangster makes you a respectable leader. 

Benjamin Glutton's picture

Erect gallows near the studio exit...CNBC is best rat trap ever,imo.

Mercury's picture

That won't happen - I can't tell if the hard-hitting news anchors on CNBC are shocked because Weill himself is saying this or because it has never occured to them that ending TBTF might actually be a good idea.

Herodotus's picture

Better yet, when he gets into the elevator to leave the building, sprinkle some of those blue prussic acid crystals into the elevator cab from above.  Have a hearse waiting for him when he gets to the lobby.

Ghordius's picture

look who is talking like a muppet here! one of i-dog's nefarious-in-chief! hilarious!!

truly a vampire-turned-muppet, I think he is just one the first of his kind that realizes that the very system they gutted is the same that is supposed to keep their wealth intact...

JOYFUL's picture

In truth Ghordius, this could be the right spot to use yur this is another of the masters-of-the-universe[indeed the very mentor of dim=on hisself!]who's mastery is merely that art of constantly redecorating the front hall of that false-front flophouse they called that it suitably reflects the temper of the times...

these are the only tru artisans left to postmodernity, interior decorators of the time and space in which we are subject to their follies and their vanities...and in the absence of any surviving aesthetic principle which could shed love or light upon us, their Louis IVth like dabblings in the pastoral settings of a staged political process are the only entertainment afforded to the peasantry, who goggle awestruck at the royal presence as their pockets are picked by the pros in the crowd.

This is raw power in action, alive with the stink of success at the shell game...the free-est of free markets' in which the kings of the jungle roam at will amongst the hard pressed herds...redimensioning their bodies into the choicest and juiciest bits of their banqueting...

and the hyenas of DC follow at respectful distance in hope of catching the remains.

i-dog's picture

Spot on assessment. And, mark my words, the call for the demise of the Central Banks and the Big Banks is going to continue to rise from a low mumble to a tumultuous roar over coming weeks (note: not months).

It won't just be Ghordius and Sandy Weill and George Washington and Max Keiser ... it's going to go mainstream! 'They' are now ready to dismantle the old money system in preparation for the new ... IMO.

PS. I still don't see an election happening in November....

MsCreant's picture

I have been perched on the precipice of doom so long, I fear I am taking things for granted and walking about the perch as if the edge is not there. I'm sick of feeling like it is getting ready to blow, and then it does not.

But I understand why you think we are there. I just can't do it any more.

i-dog's picture

I've not been on the precipice, as you put it, MsC, so I'm not exhausted, by any means ... because I've been predicting this timeline on here since that last election in 2010 ... basically, from as soon as the TP was co-opted by the mainstream republicrats (though I care not at all for party politics, I do watch their manoueverings). It was obvious, to me, that there would not be another election -- notwithstanding that 'they' control all the contestants (including Ron Paul, from the beginning, IMO) -- because all their mumbo-jumbo symbolism points to an end-2012 target date and the co-opting of the TP was the end of any political resistance in the US.

I have been trying to point this timeline out on here, and to describe the powers and agenda behind it, all that time with little impact -- though not to no avail. I have noticed a significant change in the 'junk-to-uptick ratio' on my posts recently, so there are more now seeing something of what I see. That's a good thing and makes me feel good that more are prepared, even if it's not as a result of my efforts, but that of others.

It's now basically too late for us to thwart their plans, though things can still go very wrong for them at any time ... unforseen circumstances have thwarted them many times in the past (eg. they had to do a major re-think back in 1953), and an early collapse of the EZ back to sovereign currencies would be just such a circumstance. A collapse of the EU back to sovereign states, or a sudden secession movement in the US, would be even better. I have my fingers crossed....

JOYFUL's picture

Dawg...I couldn't respond in a serious vein to yur ecomium of the woLfman, because Stooges puppetry paegant pushed me prefunctorily back into a revery of my yutful days watching the idiot box*...

but it's interesting that yu seem to accord a greater sense of 'reality' to the scripted show on that side of the pond that the Merikan one...whence cometh thy credulity? Is it a case of the grass is always greener?

There is no place in the Euromerik prison zone which has not fallen prey to the false reality paradigm of the dissimulationists by now: therefore there are no outliers of reality left in any of those regions...false narratives such as delivered by the teutonic knight are identical in intent and inveiglement to the efforts of a khazarian kook like Weill, Krugman, Roubini and the rest of the kast[e]...they both seek to set in the minds of the reader the impression of an 'actual' political process ongoing, manage by 'actual' personalities - rather than the stagemanaged show which yu clearly see to be the case in the USA...

I've simply made the same decision about blitzer ritcher as yu have come to about georgieporgie...managed disinfo designed to channel resistors into programmed protest perimeters and divide the western peeples at a time when unity is of paramount importance to their survival.

While I'm still up in the air as to whether the 'final' election farce will come to frutition, I have no fears as to the fate of the is soon to be a charnel ground of the kind that will make the bloodletting of the "world wars" seem a mere visit to the leecher. Merika will not be spared the same.

*but I do hope u will make the time to go back n see my own paean of praise for "chesty" and the magpies...and catch "mitch the monkey" channeling the Obamanation!

i-dog's picture


" is soon to be a charnel ground of the kind that will make the bloodletting of the "world wars" seem a mere visit to the leecher. Merika will not be spared the same."

I see the same, Joyous. And, like you, I'm not located in the midst of either - though I don't think either of us is any the safer for that, just spared from the full initial [metaphorical] "blast"! There is no Switzerland (neutral territory) in this particular global game!

Anyway, I believe they wish to take down the US and Europe in two separate strikes: Firstly the US, to take out the gun-toters and take over the industrial infrastructure and military hardware - without any opposition from the other ZATO members (since TPTB control ZATO anyway). Then, using the US military hardware to deter any possible outside interference, impose the same on Europe in a second "strike". (I say 'strike', though by that I mean martial law, closed borders, food supply chains cut, internal starvation and pestilence ... to unleash a massive cull and the simultaneous chipping of the survivors).

I believe it's possible, though not necessary, for there to be a major war in the ME or Central Asia to get some culling going there, too. It will certainly provide the excuse for martial law in the US, though they don't look like they're needing any excuses at this point! Wars are a very inefficient way of killing people - starvation and pestilence are far more efficient. Nuclear war would also leave too much mess for the survivors to clean up, so I don't expect any nukes going off anywhere, either.

BUT ... if the EU splinters before the above were to play out, then the suddenly independent European states would not countenance Europe-wide martial law. Similarly, if the States of the Union in the US were to achieve a sudden series of secessions, the possibility of nation-wide martial law in the US also practically disappears. TPTB need both central governments to be in place when they push the first domino....


(I'll try to check out your recommended videos, but I'm on a painfully slow and patchy internet connection).

MsCreant's picture

Great imagery. I was going to say "metaphor" but honestly, it's literally true, is it not?