January 9th, 2010
12:01 PM ET
5 years ago

Bank CEOs to answer for financial crisis

Washington (CNNMoney.com) – As lawmakers start trickling back to Washington next week, a panel tasked with investigating the financial crisis is set to make its first big splash.

The Financial Crisis Inquiry Commission, a 10-member panel appointed last summer by Congress, will hold public hearings on Wednesday and Thursday.

First up are four chiefs of some of the best-known and largest banks: Goldman Sachs, Morgan Stanley, J.P. Morgan Chase and Bank of America.

The panel's chairman, Philip Angelides, said he's interested in hearing about the banks' role in creating the crisis as well as finding out how they became "too big to fail." The federal government stepped in to prop up the banks in fall 2008, creating the Troubled Asset Relief Program to help provide them with liquidity.

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Filed under: Congress • TARP
soundoff (38 Responses)
  1. jwheeler

    Forget Brinks! These bankers have pulled off the biggest bank heist of all times. Arrest them!!!

    January 9, 2010 12:05 pm at 12:05 pm |
  2. Michael from Ventura

    This outta be good...........Will they be forfeiting their bonuses as well?

    January 9, 2010 12:14 pm at 12:14 pm |
  3. Fred

    Another waste of time and millions. What will change as a result of these hearings? The world will get a little warmer from all the HOT AIR that's generated. PERIOD.

    Let's get to work on the things that are important.

    1. Reduce size of the congress
    2. Stop wasting money on executive dinners & get-togethers.
    3. Term limits.
    4.Get people to work again.
    5 Bank regulation (HA HA).

    January 9, 2010 12:16 pm at 12:16 pm |
  4. LacrosseMom

    Few of the regular people know, about the 1933 Glass-Steagall Act. I have done some research, because I wanted to understand why this mess happen in the first place?! Part of the cause of the Great Depression was that banks, Wall Street & private individuals were betting on the Market, whether it would rise or fall. They have "Bucket shops" were they could place bets.

    Once George W. Bush became president, with a Republican majority in both House & Senate, then Sen. Phil Gramm (McCain's economic advisor) slipped into a 262 page amendment in the the "Commodity Futures Modernization Act, that basically voided the restrictions on "betting" thus, the betting on the housing market, etc.

    January 9, 2010 12:31 pm at 12:31 pm |
  5. S Callahan God help America!

    Is this now going to happen because people are 'running' to their Neighborhood banks (smaller ) now? Makes one wonder.

    January 9, 2010 12:32 pm at 12:32 pm |
  6. liberal wingnut

    Is Pelosi and Obama going to answer for the government financial crises in the future?

    January 9, 2010 12:37 pm at 12:37 pm |
  7. Jefe

    They need to bring in the federal reserve bankers/board. They created the crisis, as they have created every financial crisis in this nation since their inception. I'm not saying its necessarily on purpose, just that the biggest private banks in the nation, who have unconstitutional control over our money supply, are where we need to look. Chase, BofA, etc, are merely children to these gigantic private banks with the federal name.

    January 9, 2010 12:39 pm at 12:39 pm |
  8. Not Looking Deep Enough

    They need to delve into the Chris Dodd involvement with the banking system. What's the real connection there?

    January 9, 2010 12:44 pm at 12:44 pm |
  9. ThinkAgain

    I'm a capitalist and believe that individuals and businesses should have the opportunity to make money. I'm also a realist: greed is a very corrupting force.

    Our country has been through the cycle of boom and bust several times throughout its history; history also shows us that the times of greatest economic stability and expansion (for example, post-1929 starting with FDR) occurred after reasonable regulation was put into place.

    The Glass-Steagall Act of 1933-1999 is an example of this type of reasonable regulation, which desperately needs to be brought back. People will still be able to make money – and investors will be protected from the rampant recklessness and greed that brought about the most recent financial collapse.

    January 9, 2010 12:54 pm at 12:54 pm |
  10. ThinkAgain

    Investors have a right to have their money used in expected ways. People who want to invest in high-risk ventures understand what they're getting into; people who want to invest in lower-risk, more predictable ventures are doing so because they want to be more cautious.

    What brought about the recent global financial collapse was the breach of this trust, when investment bankers thought only of the fees they would earn, and did not do their jobs of keeping their clients and their money as the top priority.

    Reasonable regulation is urgently needed to fix this situation. We all learned to well the corrupting force of greed and the blatant disregard and contempt the financial industry has for the average investor.

    It's time to wean these addicts off their drug of easy money. If the average investor has to work hard for their income, so should the people investing it on their behalf.

    January 9, 2010 12:59 pm at 12:59 pm |
  11. Bill from GA

    Public hearings by Congress will likely turn into more posturing for the cameras by Congressional blowhards than bank CEOs answering for financial crisis

    They got the money (remember McCain stopping his campaign to come back to Washington and fix the problem) with few restraints; they do not have to answer for it now.

    January 9, 2010 01:05 pm at 1:05 pm |
  12. Fed Up

    What financial crisis?

    January 9, 2010 01:07 pm at 1:07 pm |
  13. Brunton

    Break them up and ban their officers from holding government office. They have done enough damage.

    January 9, 2010 01:14 pm at 1:14 pm |
  14. Keith in Austin

    What hypocracy! Why not allow a Private Sector inquiry to conduct a thorough probe into the bribery, pay offs, pork-laden spending of our disgusting crooks in Washington? Where is the disclosure on Tim Geitner's under-cover dealings with AIG? This is where the biggest crimes are occurring every single day primarily by corrupt Democrats. Vote the whole sorry lot out in upcoming elections!

    January 9, 2010 01:24 pm at 1:24 pm |
  15. j

    It really doesn't matter what they do. Sure they can enact new laws and regulations but eventually it's all going to get watered down again by conservatives and the same type of thing will happen again further down the road.

    January 9, 2010 01:33 pm at 1:33 pm |
  16. George Guadiane - Austerlitz, NY

    NO BUSINESS should be "too big to fail!
    EVERY BUSINESS MUST be responsible for their decisions and actions
    ANY INVESTOR who fails to make sure that they are betting on an ethical/moral/economically sound business, deserves whatever they get.

    Bank Guys in multi thousand dollar suits who remember how to get their bonuses but not how they got into the mess that they put us in – that's what we will see and hear.

    January 9, 2010 01:35 pm at 1:35 pm |
  17. Larry

    This will show more how spineless our representatives in
    Washington really are. Just like health care reform. I'm sure this media-op will somehow quietly go away with no results.

    We need to clean out Washington and bring in new blood to the House and Senate.

    January 9, 2010 01:35 pm at 1:35 pm |
  18. Silence Dogoode

    OK, let's be real. Nixon took us from a gold standard to a paper standard....mistake... from then on it has been downhill...when 2 repubs in sentate wrote a bill deregulating the industry that Clinton signed into law...this is what we get....both parties responsible...and the people who took out more $$$ than they could afford are at fault too...there is enough greed to go around....

    January 9, 2010 01:38 pm at 1:38 pm |
  19. B

    This is a prime example of the down side of Capitalism that is broken and will get worse without real oversight and regulation.

    January 9, 2010 01:47 pm at 1:47 pm |
  20. tmart

    I wish it would be a civil discourse between the Commission and the banks for the purpose of strategy for the future. Instead, it sounds like it will be accusatory and defensive in nature.

    January 9, 2010 01:47 pm at 1:47 pm |
  21. terry,va

    Let's eliminate all capitalist principles and install Obummie socialism. "Rome" is burning and the American people have their head in the sand.

    January 9, 2010 01:52 pm at 1:52 pm |
  22. Jayson

    Of course Congress isn't about to take a long hard look at their own failings and their own dithering as the housing crisis unfolded in 2006.

    January 9, 2010 02:32 pm at 2:32 pm |
  23. DEM in HI

    Amazing how people who pay their bills on time and are responsible, are the ones who have not received any help during this crisis. The FAT Bankers who took on the risk and lost, have saddled the public with a bill that can never be repaid. Goldman Sachs should be ashamed of the bonuses they are going to give out. They have not learned anything!

    The US government should tax all bonuses greater than $500,000 at a 95% tax rate. These people do NOT deserve a bonus greater than that. And if they do not like it, go to Europe where their economy is about to collapse.

    January 9, 2010 02:52 pm at 2:52 pm |
  24. Hammerer

    Will Dodd and Franks testify also?

    January 9, 2010 02:53 pm at 2:53 pm |
  25. diridi

    Banks need to be regulated by Federal Government thoroughly, so are credit card companies...ok, they are charging outrageously to interest rates...they need to wake up.....ok, and work for America...

    January 9, 2010 03:18 pm at 3:18 pm |
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