This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Gingrich Would Break Up Big Banks

NEW YORK ( TheStreet) -- Add Newt Gingrich to the list of Republican presidential candidates who say they support the idea of breaking up the largest U.S. banks.

Gingrich has climbed in the polls following Saturday night's Republican primary debate, and, like Rick Perry and Jon Huntsman, Gingrich has said he supports "very decisive reforms," with respect to the banking industry.

Newt Gingrich

"I think, in retrospect, repealing the Glass-Steagall Act was probably a mistake," Gingrich told Jake Tapper of ABC News in a recent interview, referring to Depression-era legislation that prohibited any combination of commercial banking, investment banking and insurance at the same company. The law was effectively repealed in 1999.

"We should probably re-establish dividing up the big banks into a banking function and an investment function and separating them out again," he said.

Huntsman and Perry were critical of the big banks during Wednesday night's debate, with the most detailed comments coming from Huntsman, the former Utah governor and ambassador to China.

Huntsman referred to "six institutions that are equal to 60, 65 percent of our GDP, $9.4 trillion," arguing "they have an implied guarantee by the taxpayers that they'll be protected. That's not fair, that's not right for the taxpayers," Huntsman said.

Huntsman was referring, of course, to JPMorgan Chase (JPM - Get Report), Bank of America (BAC - Get Report), Citigroup (BAC - Get Report), Wells Fargo (WFC - Get Report), Goldman Sachs (GS - Get Report) and Morgan Stanley (MS - Get Report) and his numbers were right on, according to this data from the Federal Reserve.

Asked what he wanted to do about this issue, Huntsman said, "we need to right size them."

Texas Governor Rick Perry voiced a similar sentiment during the debate, saying, "if they're too big to fail, they're too big."

-- Written by Dan Freed in New York Follow me on twitter.
Disclosure: TheStreet's editorial policy prohibits staff editors, reporters and analysts from holding positions in any individual stocks.

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
BAC $14.55 -1.60%
C $46.28 -0.96%
GS $164.05 -0.15%
JPM $63.21 -0.61%
MS $27.06 -0.62%


Chart of I:DJI
DOW 17,773.64 -57.12 -0.32%
S&P 500 2,065.30 -10.51 -0.51%
NASDAQ 4,775.3580 -29.9330 -0.62%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs