Photo: Bloomberg TV
Another massive financial crisis is what’s needed to break up the big banks, which are facing a problem that has not gone away, Nouriel Roubini said on “Bloomberg Surveillance” this morning.Appearing with Ian Bremmer, president of the Eurasia group, Roubini said that the banks that were too big to fail before the financial crisis, are even bigger and more problematic now due to mass consolidation.
Roubini, who predicted the 2008 financial crisis, said:
“The only solution to to break up too big to fail banks. There is no other alternative. We have to go back to Glass-Steagall. I would have thought after the worst global financial crisis in a generation, the decision would have been made. Maybe we need another big financial crisis. For the time being, the politics will not lead us there.”
Bremmer, a prominent political scientist, added he agrees the political leadership to break up the banks isn’t coming anytime soon.
“We are too big to fail and that has only become more true since 2008. It is the reason why people continue to put more money in our equities and our treasuries.”
Watch the video below: