Wall Street CEOs Want the Line Between a Federally-Insured Bank and a Wall Street Trading Casino Erased; Regulators Want Higher Capital to Prevent That

by Pam Martens and Russ Martens Wall Street on Parade

David Solomon, Chairman and CEO of Goldman Sachs, let it slip out at yesterday’s Senate Banking hearing what is really driving the mega banks’ backlash against federal banking regulators’ proposal to raise capital requirements at banks with more than $100 billion in total consolidated assets. (Community banks would not be impacted by the proposed capital increases.)

Solomon responded as follows to a question on the proposed new rules, attempting to justify how the trillions of dollars in derivatives his firm is holding inside its federally insured and taxpayer-backstopped commercial bank, Goldman Sachs Bank USA, is helping the country and that raising capital requirements on those trades would raise costs to consumers:

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