Perspectives on the Size of Big Banks

Here are two ways to look at how big the really big banks have become:

• In 1995 the six largest banks had assets which equaled 17% of GDP. That number today is 63%.
• What percentage of bank assets are owned by the ten largest banks? In 1990, 24%; in 2000, 44%; in 2009, 58%.

Another way to look at the banks' sway is to ask are appropriate laws being enforced?

• In 1970 the Federal Reserve was given the power to limit the size of banks. It has exercised this power zero times.
• In 1994 a law was passed that no bank could own more than 10% of total deposits. Was it ever enforced? Not as far as Bank of America, Wells Fargo and Chase are concerned as they are in violation.

And a relevant quote from none other than Mr. Exuberance, Alan Greenspan, “In 1911, we broke up Standard Oil. So what happened? The individual parts became more valuable than the whole. Maybe that’s what we need.”