Treasury chief says US can achieve 3 percent economic growth

Saturday, 20 May, 2017

Mnuchin said that before the hearing he had checked that Treasury staff "had fully responded to all the inquiries from you and the committee" and asked Brown to send a note reminding him to deliver the list.

She ended by saying, "We are in favor of a bill that is called breaking up the banks only don't break up the banks". And Trump has made statements that seem to suggest he supports the idea. Top economic aide Gary Cohn said in April that the administration supports a firewall between investment and retail banking. Elizabeth Warren (D-Mass.) jumped on these competing claims. But Mnuchin took a different position Thursday.

"What I have said repeatedly is that any plan we put forward we believe should be paid for with economic growth", Mnuchin told the Senate Banking Committee. Brown's office said Treasury's brief letter had not answered his questions. "This is like something straight out of George Orwell", she says.

"If we did go back to a full separation, you would have an enormous impact on liquidity and lending to small and medium-sized businesses", Mnuchin added.

"The fundamental part of Glass-Steagall was separation [of commercial and investment banking functions], Mnuchin said". What does it mean to be in favor of 21st Century Glass-Steagall if it does not mean breaking apart these two functions in banking?

Mnuchin was clear about what a 21st Century Glass-Steagall would not do, but he was less clear about what it would.

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"I feel for the first time a real opportunity to align not just the interest of USA taxpayers and the fact that we want to have a housing finance system that is robust but also, in fairness, one that more fully aligns the public sector interest and the private sector interest", concluded Senator Corker.

Warren asked Mnuchin if he changed his stance after meeting with CEOs of big banks. Thom Tillis (R-N.C.), who immediately followed Warren. "Our initial report will contain recommendations to provide relief for community banks and make regulations more efficient, effective and appropriately tailored".

"We are studying ultra long bonds which would be 50 year bonds or even longer", he told members of the Senate Banking Committee in a hearing.

He said he would call for exempting all banks with less than $10 billion in assets from rules under the 2010 Dodd-Frank financial overhaul law. It was fully repealed by Congress under President Clinton in 1999, less than a decade before both Republicans and Democrats responded to major bank failures with massive taxpayer bailouts.

MNUCHIN: I apologize that I was not aware of that. This intermingling of the two sides of banking has been blamed by critics - including Warren - for helping to cause the financial crisis (though this point is up for debate among many economists and academics).