Inquiring minds are watching Bernanke squirm under pressure from Senator Elizabeth Warren who complains “Too Big To Fail” is now bigger than ever before.
Warren: These big financial institutions are getting cheaper borrowing to the tune of $83 billion in a single year, simply because people believe government would step in and bail them out. And, I’m just saying, if they’re getting it, why aren’t they paying for it?
Bernanke: I think we should get rid of it.
Warren: Alright. I’ll ask the other question. You were here in July, and you said you commended Dodd-Frank for providing a blueprint to get rid of “Too Big to Fail”. We’ve now understood this problem for nearly five years, so when are we going to get rid of “Too Big to Fail”?
Bernanke: Well, some of the you know uh as we’ve been discussing, some of these rules take time to develop. Uh, uh. ….”
It’s safe to say Bernanke was not prepared for this line of questioning.
Mike “Mish” Shedlock