May 14th, 2012
10:55 AM ET
11 years ago

Warren: 'Guerrilla war' underway on Wall Street

(CNN) – Elizabeth Warren, the consumer advocate and Democratic candidate for U.S. Senate in Massachusetts, said Monday the constant dodging of effective regulation by Wall Street banks amounts to lobbying warfare.

Warren's comments came after she called on JPMorgan Chase boss Jamie Dimon to step down as a director of the New York Federal Reserve board after his firm announced a $2 billion loss since the start of April.

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"There has been a guerrilla war out there in which the largest financial institutions have been doing everything they can to make sure that financial regulations don't get put in place and if they do get put in place, that they are loaded with loopholes and not very effective," Warren said on CNN's "Starting Point."

Warren is engaged in a heated battle in Massachusetts against Republican Sen. Scott Brown, who she labeled "Wall Street's favorite senator" on CNN Monday. Brown has defended contributions he receives from Wall Street, saying the number of financial firms in his state naturally leads to increased contributions. In her campaign, Warren often takes a hard line against big banks, who she portrays as having too much power over the political system.

The problem originates with the teams of lobbyists hired to dissuade Congress from passing effective financial regulation, Warren said.

"There is a lobbying army hired by these financial institutions because they really don't want to have any oversight," Warren said. "They want to take on risks, and let the rest of us deal with the consequences with anything goes wrong."

Warren's Senate campaign issued a statement Saturday calling on Dimon to step down from the New York Fed, which helps institute monetary police and enforce financial regulations.

"We need to stop the cycle of bankers taking on risky activities, getting bailed out by the taxpayers, then using their army of lobbyists to water down regulations," Warren wrote in the statement. "We need a tough cop on the beat so that no one steals your purse on Main Street or your pension on Wall Street."

Warren said on CNN Monday that America's banks had problems both in size and mindset.

"The problem is a combination of size and attitude," Warren said. "They are too big. There's too much power concentrated in just a handful of institutions. But it's also that they have the attitude of 'Leave us alone. We will manage our risks internally, we will take care of it all ourselves and we will come back to you only if things go wrong and we need some help and we need a bailout.' We can't run an economy that way. We can't run a country that way. We have to stand up as a people and say no more of this."

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Filed under: Elizabeth Warren • Wall Street
soundoff (18 Responses)
  1. tryanothername

    LOL ; the war on Wallstreet, guess ti goes along with the war on women, war on povery, war on terror, war on drugs, war on science, war on religon, war on christmas.

    No wonder nothing gets done, so many wars going on.

    May 14, 2012 11:07 am at 11:07 am |
  2. Newmoon2

    Banking has become a shell game with the consumer paying the price for the deception. They cry foul on every regulation yet the executives get rich regardless of how poorly they perform. How is this good business or good corporate behavior?

    May 14, 2012 11:12 am at 11:12 am |
  3. The REAL Truth...

    This is the fundamental Wall St. problem. They are in the business of making money and have traditionally hedged ('scuse the pun) their bets on both sides of the aisle, giving generously to both Dem and GOP candidates. Google the Goldman-Sachs conspiracy.
    Of course, the right wingnut haters are blasting the POTUS for all that ails Walls St, (no surprise there) when in fact, it's mostly due to the free market rules that the GOBP want kept in place, and have done everything in their Congressional power to filibuster or block. This ensures that their 1% handlers continue to rape and pillage the country and make huge profits at our expense. Biz as usual for the elite.

    May 14, 2012 11:16 am at 11:16 am |
  4. d

    I pick warren as the tough cop!

    May 14, 2012 11:18 am at 11:18 am |
  5. Obama 2012 - BEND Forward America, take another 4 long years of FAILURE

    Warren: 'Guerrilla war' underway on Wall Street
    The only 'Guerrilla war' is the war that leftist like Warren are conductin gon banks and other American businesses. These fools think they can regulate all of the risk of doing business out of existence. The nature of investments involves risk. The ONLY way to eliminate risk is to eliminate investments and put money into savings accounts.

    So they lost what sounds like a lot of money but they STILL made more than they lost and will post a profit. Warren just wants to use every opportunity to attack these banks and companies because that is what leftists like her do. She's a very dangerous person that thinks she knows better how our economy and banks should be run. Just another know-it-all leftist Harvard professor with no real world experience.

    May 14, 2012 11:19 am at 11:19 am |

    This is precisely why we need Ms. Warren in the Senate. She understands the dirty tricks that get played on Wall St. The last person we need in the Senate is Scott Brown -aka- Wall St's favorite senator. Deregulation is what got us into this financial crisis. We are not turning back time and having Wall Street play by their own set of rules.


    May 14, 2012 11:27 am at 11:27 am |
  7. Pander Bear

    Can't wait until she is elected Senator and can sponsor legislation to stop the Wall Street crooks. Go Elizabeth!

    May 14, 2012 11:28 am at 11:28 am |
  8. Claudia, Houston, Tx

    Honestly, is it "loss" or is it "theft" and if it's a "loss" who are the losers and if it's "theft" then take a good guess as to who profited.

    May 14, 2012 11:36 am at 11:36 am |
  9. Jaded

    Imagine these same crooks being in charge of managing the social security fund and causing it to incur that amount of loss after being privatized by a President Romney.

    May 14, 2012 11:37 am at 11:37 am |
  10. Fair is Fair

    Methinks this squaw speaks with forked tongue.

    May 14, 2012 11:39 am at 11:39 am |
  11. gg

    when the wall comes tumbling down .the hole country will pay

    May 14, 2012 11:39 am at 11:39 am |
  12. rla

    Gee and where is Obama today??? Getting paid to stop the regulations and being able to blame the republicans... Wake up people this guy speaks from both sides of his mouth!

    May 14, 2012 11:40 am at 11:40 am |
  13. B.

    Warren is right, the same Games are being "played" on Wall Street and nothing has changed the mentality there and won’t change until -Real Regulation is put back in place.

    They would do it all over again and expect the Taxpayers to come save their butts yet again..

    Greedy idiots.

    May 14, 2012 11:44 am at 11:44 am |
  14. kafantaris2

    The derivative hedging game played by JPMorgan Chase is no different than that played by AIG in 2008.
    Yet, Jamie Dimon tells us that Chase had merely “made a terrible, egregious mistake.”
    He might as well have said that Chase was wrong in raising in a game of poker, when it would have been more prudent and folded. But why was Chase busy gambling in the first place - right after our economic meltdown, and while fighting government regulation?
    One answer is because Chase could bear the gambling losses.
    That’s right. With $2 trillion at hand, Chase can yawn when $3 billion goes down the tube.
    Nonetheless, Dimon tells us that he sees no problem with the government dismantling big failing banks. This is nice to know because the government should start dismantling big banks before they fail - and before they have another chance to take us down with them.
    The important lesson then from this Chase episode is not that stringent regulations are needed to reign in on derivatives, but that banks big enough to take huge hits standing up are ripe enough for us to chop down to size.

    May 14, 2012 12:19 pm at 12:19 pm |
  15. Sniffit

    "These fools think they can regulate all of the risk of doing business out of existence. "

    Nope. NOBODY is trying to do that. It's about the level of risk and with whose money the banks are taking it. Nobody's trying to reduce it to zero because that would be quite literally impossible, but the excessive risk taking the banks and financial institutions have engaged in...the kind that led to the crash in the first place...needs to be reined in.

    Nice try though. People with your sub-sentient IQ level will certainly be apt to believe the kind of nonsense you're selling.

    May 14, 2012 12:19 pm at 12:19 pm |
  16. justao

    Love to hear Republican voters argue that Democrats are puppets of Wall Street also. Really? Is that why Democrats authored Glass-Steagall Act, Frank-Dodd Act, in which every Republican want(ed) to repeal.

    Everyone in congress is owned by Wall Street yet atleast Democrats put on paper that they want to protect consumers a little whereas Republicans could care less about consumer protection.

    Never (NEVER) has any Republican authored a bill to protect consumers and the average American against Wall Street, insurance companies, pharma, corporations, or any bad business policies. Republicans only care about the rich and corporate profits. Why else do they only elect rich business men for politicians. You'll never find an economist or actuary researcher running for Republican congress. Free Market worship leads to great recessions/depressions. FACT check that!

    May 14, 2012 12:20 pm at 12:20 pm |
  17. Obama 2012 - BEND Forward America, take another 4 long years of FAILURE

    Sniffit - Nope. NOBODY is trying to do that. It's about the level of risk and with whose money the banks are taking it. Nobody's trying to reduce it to zero because that would be quite literally impossible, but the excessive risk taking the banks and financial institutions have engaged in...the kind that led to the crash in the first place...needs to be reined in.
    Well then where are all the new laws and regulations for Fannie Mae and Freddie Mac, the ones that really caused the disaster, along with the Democrats, homes for people that can't afford them policies (aka subprime mortgagaes)? The execs there have been the ONLY ones charged with wrong doing after 4 years. But Fannie Mae and Freddie Mac are dolls of the Deomcrats that get protected because they are used to promote their insane and bankrupt social policies.

    May 14, 2012 12:28 pm at 12:28 pm |
  18. kelly

    Split up the big banks now!

    May 14, 2012 12:37 pm at 12:37 pm |