How to Structure a Regulative Environment for the Savings Loan Debacle

It’s been two years since Bill Black was last on with Steve. We’ve invited several guests to talk about the collapse of Silicon Valley Bank, so it only makes sense to ask our whistleblower friend to weigh in.

Bill and Steve discuss what it means to be too big to fail. When an institution is too big to fail, the creditors get bailed out, but then, Bill says, “really really bad things have happened.”

“...they hold the economy hostage. And nowadays they hold the global economy hostage. And if you hold the global economy hostage, you hold global politics hostage. So that needs to be fixed. And the way to fix that is not to allow such institutions, right? Duh,”

The episode looks at the capture of government by the financial industry. Bill talks about his experience during the savings and loan crisis and the transition from somewhat effective regulatory apparatus to a fully cock-blocked system. (Our words, not his.)

Bill Black is a professor of Economics and Law at the University of Missouri – Kansas City (UMKC) and the Distinguished Scholar in Residence for Financial Regulation at the University of Minnesota Law School. He is a serial whistleblower and authored The Best Way to Rob a Bank is to Own One.