coming up next. guest host larry doyle. all authorize of in bed with wall street. the guest this week, nomi prins, author of "all the presidents' bankers" exploring the multigenerational relationships in the financial and political worlds that are the basis of car and influence in the u.s. -- of power and influence in the u.s. the program is about an hour. >> welcome. i'm pleased to have with me today a wall street insider, renowned journalist, author, and speaker, nomi prins. having worked at chase manhattan

bank here,man brothers, bear stearns, and a managing director at goldman sachs, nomi prison s had a distinguished career on wall street and has only distinguished herself further by sharing heir -- her expertise via the written, spoken word. she had written a number of acclaimed works, including other people's money, it takes a pillage, and black tuesday. she joins me today to discuss her most recent work "all the presidents' bankers: the hidden alliances that drive american powers." nomi, welcome concluder congratulations on such a fabulous back. as we take a look into washington, wall street, and the families that have had such an enormous impact on our nation and the world. >> guest: thank you so much, larry thank you. thank you for the lovely introduction as well. >> host: my pleasure, very easily done, given the fabulous career you have had, both on wall street and now off wall street in the literary world.

so at it really a pleasure to have you. let's dive right in. this is truly an incredible -- i would say an unparalleled -- written history of the relationships between wall street, the large banks that have dominated our nation, and washington. what motivated you to take on such an incredible amount of effort and exercise? >> guest: a slight bit of insanta, in the amount of time i spend working on it and the intensity. but the novel i had written, "black tuesday" on the crash of '29, had a scene in it i researched slightly on six bankers that had gotten together at the house of morgan one noon to decide to try and save the markets that were crashing around them in late october 1929 by themselves. and a fellow named tom lamont, the acting chair of the morgan bank at the time, his real

chair, jack morgan, was gal vanitying around the elsewhere. gathered five other bankers together, the most powerful families of bankers running the most powerful banks on wall street, saying we need to do something to save the markets. and they decided with just 20 minutes to throw in $25 million each into a buying pool, tell one of your guys to buy a lot of stock and basically buy themselves, try to boost the market falling around them. i just found that really fascinating, this idea this big six banks. and i noticed today we have six banks and i looked back in time just cursory analysis and there were six banks 100 years ago in the panic of 1097, and they were all largely the same banks. the first part of the century, the same families, now similar legacies. but i started to say, what is that relationship? i was fascinated in other works i had done with the political association of bankers, so i decided to look at the history of the period and look at the

real relationships between six bankers, who are the most important one was at any point in time in our nation's history during that century back and their connection tore president, and what i found, because i didn't know that every single president from teddy roosevelt through barack obama had strong associations, not always with six key bankers but certainly with a subset at least of six bankers through documents and letters and phone calls and all sorts of other forms of communications as well as social connections through clubs and harvard and other places where they immediate. >> host: relationships are everything. and whether people want to promote those relationships or not. let's take a step and go behind the scene. could you take us into your research. where did you go? whom did you meet to unearth

some truly incredible material? >> guest: i decided to good to all of the presidential libraries to make the research very even and always start from the president out, to weather they had associations with particular bankers. so, for every period in time i wanted to make sure id at least had the appropriate historical events that would have occurred at that time. i used to joke with me editor and i would say i just don't want to forget that world war i happened or forget vietnam. so i had an outline of major events that happened, and each president, of course, and treasury secretary, and went to all the presidential archives where the material existed throughout the country, for example, i was at abilene, kansas, in one hot august, working with the archives of president dwight eisenhower, from where i went to independence, missouri to look at the archives of president truman. i started actually in austin with lbj, and went back to

austin self times throughout the period of research, because i found that that period very critical in terms of relationships and changing attitudes in america between presidents and bankers, citizens and presidents and so forth. and i really just dug in deep, and i didn't know what i would find in some cases i had to submit foias, freedom of information acts to unearth certain documents for the more recent presidents that had not been unearthed yet. the reagan library in california, the archivist really kind of took my project to heart and spent some of her own time really trying to look for documents for me as i was sitting there going through the boxes i had. when you do research they bring out carts and boxes and it's almost like a race. you're going through the bongses. what can i find in -- through the boxes. and there would be anything,

like hari truman, why did are you drop the atomic bomb, from letters from bankers for saying thank you for your support, and him writing back, keep it have done it without you. so all sorts of things you find and you get into this mode of being in that time and that president with those people. going through just this immense amount of documents and typing it up at night, editing throughout the process, and then going on to the next location and the next president. >> were there any libraries that were -- that you deemed to be somewhat reluctant to share information? >> guest: well, until reagan actually -- from fdr through the reagan library era, there was a certain code under which everything is classified. military information, finance information, financial, personal relationships, and it's very clear and almost easy to access the information. the carter library, i went there

shortly after the film ""argo"" came out and there had been a team of "argo" researchers down there before the movie looking up information about the iran hostage crisis and what happened, and they had this cool rack system where you could go in and look digitally at a lot of documents, not every library has that. but then when some of the more recent libraries -- the clinton library there's little already open and that's because there's an immense amount of information and now you have e-mail and everything needs to good through security clearances and it's in a different code. after reagan came in the codes came. a lot harder to find information. the reason i could find it in the reagan library is because the archivist had worked at one hoff the prior libraries so new the difference between in the new codes and old codes. but i still have foias outstanding at the clinton library, still have foias at the george bush library in texas and the george w. bush library just

opened so i didn't have the opportunity to look at anything in there, and obama is in office. >> host: was there a point in time where the pictures started to -- or the -- started to sharpen in terms of the nature of some of these relationships, where it really -- where you started to realize, wow, this actually goes deeper than perhaps either yourself as well as the public would have imagined, or might even still imagine? >> guest: yeah. because i didn't really start at the beginning of the presidents, i kind of worked more on geography and flight patterns. i was doing a little jumping back and forth. so for example i would to the lbj library and see his relationship with sidney wineberg, the chairman of goldman sachs at the tomorrow, and then be at the fdr larry and see how they had been closed friends because of something lbj said to sidney wineberg, we were

both fdr men, so good to have you on me time again. and then when i went to the fdr library to see the beginnings of that relationship. so, a lot of times starting in the middle of history and going backwards allowed me to catch up in the middle and good to the same bankers and see their relationships with all the presidents in between. when i saw many instances if you had a relationship with one president, you had a relationship with many. and going back furor further in time -- i mentioned how tom lamont was the chairman at jp morgan in the crash of '1929. and what i didn't know -- i found another when i what at the fdr library in hyde park, where i grew up and had gone as a kid -- he actually had rented out his townhouse on 65th 65th street in manhattan to thomas lamont for several years

while fdr was the assistant navy secretary under woodrow wilson. so the tie that happened after the crash and into the great depression when fdr was then president, started way back. they had both gone to harvard. they had both been involved with the crimson harvard paper over there tom lamont had actually been one of the editors of the paper when he was at harvard. and they had a very long history, which then lasted through several decades. so, you just kind of -- there was an onion effect where you just layer and layer and wouldn't be history going forward. it was history going backwards and decaded and relationships in between. >> host: so the relationships really went from not only the business and the political but often into the social as well, then. >> guest: yeah. exactly. one of the other bankers, for example, winthrop al dribble who was a yacht0sman, and one of his

boats won the world cup. and there was a lot of that going on, and fdr and his sons were interested in that. and so of course jp morgan had a trim yacht at the time, the equivalent of larry ellison so there were similar tastes as well that came into play. and so there were social gatherings. going forward in history, for example insuring 1938, fdr had at this point appointed welsh known name, well-known family name, joseph kennedy to be the first head of the ftc when it was created, and also he appointed million to be uk ambassador in the late 30s after joe kennedy was head of the fcc. so now joe kennedy is off in england, having a gala coming out party, very lovely social event for his daughter, kathleen, who unfortunately died young as part of another kennedy tragedy, but john f. kennedy, a young john f. kennedy, was at that event. david rockefeller, who was part

of a long history of industrial, financial family strengths, was also there. in fact he somewhat dated kathleen kennedy for a minute back at the time. and so the ties, these connections, were -- went through all sorts of social and events that people wouldn't be involved in. >> host: not just the social and the individuals but as you're just alluding to, the strength of the families as well. and those family ties that run deep. the morgan, rockefeller, kennedys. >> guest: the roosevelts, james roosevelt, fdr's father, and jp morgan, the famous and powerful jp morgan,crafted together among a few other established families, the metropolitan club in new york, very exclusive club where these men could get together and talk about affairs of the day and decide things, in a very small, tight environment.

>> host: borders on royalty almost. >> guest: it really was. when you think about it, even the terms today that are used for ascension, the throne, the hierarchy. terms used i

after the panic and after jp morgan got friends together to decide which banks or trust companies could live or die or how much money eached a to pony up to back them up, he was a little afraid, and thought, i don't want to have to do this exercise again. i would prefer a central bank as

well. so the bankers who got to this idea of having a central bank to help subsidize or stabilize them so they wouldn't have to put their own money in, whether or not they caused the panic and from a government standpoint, teddy roosevelt didn't talk about so it much but when taft came in as president he pushed the idea of having a central bank. and nelson aldridge and the aldridge family was close to the taft family and basically decided they would do these expeditions into europe and see what was going on with the bank of england and france and see if america couldn't produce something that was more american or have this powerful central bank to bank bankers and the emerging currency going to be the most powerful currency in the world, the dollar. so fast forward a few years of fact-finding and traveling around europe, and nelson aldridge went with james stillman quite often, the head of national citibank, and he got back, and filed documents, and

things weren't at an official level. jekyll island happened because it was time to make it official. and jpmorgan said you need to do this somewhat privately, only after nelson aldridge was hit bay trolley car on madison avenue. he was in new york, discussing things with bankers, his son lived in new york as well. he got hit on 60th street by the trolley car. so he was convalesced and had been planned to have a big meeting at his estate? rhode island. but now he is in new york, with the bankers, and morgan has this club membership at the jekyll island club, and sponsored -- which is something i found out when i went there myself -- sponsored this six-people, again, to work together at -- in secrecy, away from eyes, to bash out this idea of the fed. the sort of cloak and dagger stuff is a little bit

exaggerated. it wasn't like you had paparazzi flying in, and at jekyll island it's generally -- at the time it was off the coast and couldn't get there. couldn't drive there. and there were posts of men watching if boats came in to make sure they couldn't even dock near the jekyll island club. so it was a pretty secure place already anyway. and that's where they bashed out the plan, and at the end of them bashing out this plan, nelson goes back to washington to present it to the senate. and what happens was he was still not feeling well from the trolley car situation, and so what occurred was two of the bankers who had been at the meeting, frank vander lift, the number two at national citibank, and henry davidson, who was one of the senior partners at the morgan bank, actually presented the plan to washington, which i did not know eitherring this is something i discovered in the

book. so wasn't even the banker's planned this whole thing. they actually went to washington to present the findings. the actual federal reserve act that was passed ultimately under woodrow wilson looked a little different from that plan, but it had a lot of similar aspects of it. this idea of a central bank. the concession was there would be a new york fed, which would be close and has continued to be close to wall street banks, and then there's the federal reserve, which the president would appoint the chairman, and so there was kind of this idea of a balance of power, and everybody was happy and there was a whole bunch of stuff in the book about all the maneuverings at midnight and 1:00 a.m. in the white house until that finally did get passed and signed under wilson. >> host: clearly the federal reserve is a lightning rod, especially currently, giving the easing programs going on. but right from the outset, it's

always been promoted as an independent institution. in your opinion, can it be independent, given the nature of the relationships as you have laid out? i mean, exquisitely in your book? >> guest: no. at it naive to think it can be independent. one, because the very structure has member banks within each of the federal reserve banks, shares in the federal reserve as a entity. so there's an even ownership type of relationship there buttoned that, in the philosophical relationship, the strong one, that started back in jekyll islands and has gone through today, it's actually benny man strong, one of the guys who has been at jekyll island. so got to be head of the new york fed, and paul warberg, another of the men at jecking island, was aopinioned by woodrow wilson to be one of the

governors of the first federal reserve, and from the beginning through world war i. so, from the get-go there was a connection between how it was established, why it was established, and the appointments that were allowed and physically don -- done by the president and that hasn't changed. there's never been a suggested appointment that's come through a president that has not been accepted by congress who was supposed to have an extra say in this. it's always been a very slam-dunk situation. larry summers took his name out of the plate and other stuff happened there can but for the most part historically, every time a president wanted someone at the helm of the federal reserve it happened, and from the beginning, these people tended to be bankers, particularly on the new york fed, which is the most powerful component of the federal reserve system. >> host: remains a fascinating

topic, and again, all these calls for transparency, relative to opassty -- opaquity. and the book "secrets of the temple" inspired. my could have spent more time on earlier years in the fed but he did such a great job on on that. >> host: having studied extensively the presidents as well as the bankers, in your opinion, have there been a couple of presidents, either who really stood out in your eyes as just being truly magnanimous in their -- the way they executed their office, or on the other end of the spectrum, woefully weak and far too willing to turn over the reins of power to the bankers? >> guest: well, back in the '20s, before the crash on

1929, we had a succession of presidents, from harding through calvin coolidge, threw herbert hoover, all of whom allowed the bankers who were their friends also, to do what they wanted to do because they believed this was important after world war i, not just for financial power but for america's emergence as a political superpower. if you had banks who could expand and basically do what they said they needed to do to become strong that was good for america in general, which is actually a theme that continues to exist through today and that was specific because of the post war and the emergence of america the superpar. calvin coolidge did nothing to thwart any of this. he was famously talking about how the business of america is business, but also his treasury secretary the treasury secretary that served for harding and

coolidge and hoover and andrew melon, was a banker and believed it was important to allow the banking community to do what it needed to do, which meant not having any real rules, and they also met results with a tremendous amount of speculation after world war i that ultimately led to a tremendous crash, which ultimately led to a great depression. so, those presidents had relationships but they didn't really try to use them to get anything back from the bankers. it just going forward in history, lbj was someone who didn't come from the same eastern establishment societal connections as some of the main bankers about he was such a master politician that he understood how to sort of stroke the personalities and the positions of the people in power and banking at the time, as well as get stuff done. so, he was very much a man

about, i will pass -- i will not restrict you. i will not worry about your competitors, smaller type ofs of financial service firms who think you have to much power. i will do what you need to do but you need too support my great society and not say anything negative in the press. you need to be on my side. and that continued into the beginning of the vietnam war. a lot of bankers who helped raise money in the beginning of the war. they subsequently turned against him as things started to unravel towards the under of his second term, but he just knew how to use the relationship to work for a broader public interest as well as allow the idea of financial strength to continue. so he was very good at doing that. not having had as many long-standing connections as someone like fdr, who did a lot of that when he worked on his

policies. >> host: let's stick with the topic of the war. the 20th century, the two great wars, korean crisis, the vietnam war as well, then also the cold war. what sort of role did the banks and these bankers play in terms of our nation's involved, both preand then post war? >> guest: it goes back to the woodrow wilson, thomas lamont relationship, back during the end of world war i. first the morgan bank itself worked with wilson and the treasury secretary at the time to finance 75% of the private investment that went into funding allies for war-related arsenals and so forth. so there was already a very strong alignment between the morgan bank and the white house, very regular, very much an idea that money that needed to go into the war effort was going to be consolidated through the private bank, and then of course

there was war bonds where individuals across the country were asked to invest in the war, invest in america and so forth, and that helped banks grow because they had new customers after the war. and then in the second world war they sort of tried to do the same thing. there's some different people at the helms of the major banks and at this point winthrop aldridge who was running chase stepped into the forefront because of his relationship with fdr and there was a relationship with the vice-chairman of national citibank, burgess, who was the treasury secretary under fdr during world war ii, that allowed these institutions to continue private financing of the war but also a much larger blanket approach to getting individuals to buy war bonds and take out accounts in these banks at the same time. so, that was the way they sort of combined helping the country, expanding their presence and getting new customers.

but then by the time you got to the cold war all these new customers are there, and the policy of america under truman and eisenhower was to make sure that communism could not prevail basically throughout the world, and that capitalism would be the dominant-ism. and in eisenhower's doctrine he basically states that america would stand ready to fight from a military perspective or an economic perspective or what he said was a trade perspective, in order to protect its allies effectively, this ones on the capitalist side of the equation. that helped the bankers because all of a sudden they had military support to expand their branches into the countries, and as a result of the beginning of the colored war they expanded into cuba before castro came in andage nationalized the banks. they expanded into beirut but a is would be a -- because it would be a stronghold into the rest of the middle east, and all of this was done with the

protection of the u.s. military. so, the whole idea, the whole reason, the international aspect of banking happened, particularly with these major banks, was the connections they had into presidents and policies. and they also were on the pulpit to promote policies. winthrop aldridge win around the country talking be about the truman plan and open trade and free trade and an alignment amongst people who knew each other and used each other to expand. >> host: truly fascinating stuff. you talk about the sense of alignment, and clearly coming out of the depression there was this antibanker, look what you just did to us, in terms of speculation, working our way into world war ii, where this sense of collaboration, and now it seems to have come full

circle again. it's this cycle, these ups and downs. are the bankers in your opinion, though, at -- trying -- how they balance that profit motive and incentive versus national interests. >> guest: that is a big cycle. that was something that was ver interesting to me in the book. the fact that algiers was working with fdr to pass the glass stiegel act w

>> guest: kind of happened in two stages. one, after the period of alignment between fdr through eisenhower, where the needs of the -- the political needs and financial needs and individuals were all on the same page and very closely connected in con conference, and you had jfk come in and he did family basis, certainly had relationships with the people that were rising at the major banks, but a it bit sort of standoffish bottom the idea of asking them for favors, and as a result they weren't as nice to him publicly. and in fact in 1962, david rockefeller wrote a very sort of -- they had a famous set of letters published in life magazine between rock feller and jfk where on the surface they looked like they were being collaborative but if you read the text sounds like david rockefeller is critical of the initiatives of jfk, in particular, with respect to

latin america, jfk didn't want to fully have latin america open to the private interests of individual companies. he thought they should be strong rather than simply pushing their leaders to be open, whereas david rock rockefeller and people coming into the folds of major banks, saw this as a tremendous opportunity. cheap mottes. right next door. branches were going up left and right. and they really wanted the government to support much mother of their private endeavors, and jfk kind of thought that latin america should be strong on its own. so that was kind of a divergence, and then he was assassinated and lbj came in and he had this -- first first of all much more than.the private interests and international and much more supported what the bankers wanted to do, and had many more personal -- he knew

how to stroke their egos. a lot of invitations, a lot of back and forthbetween wine wearing and david rockefeller and members of the national citibank and invited to his rank, monthly elite dinners in washington where he would invite very particular members of the financial and other types of business communities to make them just feel like they were all on the same side. and actually even after kennedy was shot and lbj came into power, there was tremendous support. he had more public support in the press and on wall street to -- thaws they thought he be supportive of what they want to do. so got back to connections. nixon was a bit more like jfk which a lot of people wouldn't say. but from the standpoint of this collaboration he didn't want any part of that. two points during his presidency, for example, though,

he did suggest that david rock -- rockefeller should be treasury secretary, and he said no. they're busy expanding, and he didn't did them personally. lbj would get on the phone, invite them to the white house, be buddy, buddy, how is your daughter. and he didn't do that. and they had gotten together and figure out we can take policy from here and they actually pushed nixon and people in his cabinet to get off the gold standard, which happened in the beginning of nixon's presidency and all sorts of other things that now they started making demands without feeling they needed to give anything in return, and i could -- there's a lot of stuff on the books that then deinvolved into middle east oil and other thing that came out of that disalignment. >> host: got it. so, was it your sense at that point in time that the bankers

felt, you know what? actually have more power where i'm currently situated than one might think they would have in -- whether at it the head of treasury or elsewhere in washington. >> guest: that was exactly it. they had just gone through this expansion. they were still going through it. there was consolidation in the banking industry. because none of the presidents had gotten in the way of having that consolidation and concentration happen. so it was much more lucrative from a power influence and wealth. money wasn't even really the thing. more about the influence and be power to not have to work on sort of the republican, international interests side, and having access to petro dollars to oil in the middle east in the '70s was a big point of departure because you don't need the backing of the

military. you have extra money that you can refum around the world-derunnel around the world which went into the debt of latin america and caused the cries which was bailed out by the government. >> host: let's stick with this theme, the whole concept of bailouts. we had the massive bailout in 2008, and the american public is never again, we can't do that. just stay away from it. and washington promotes, we're taking care of that so never have to have another bailout. 2008 was not an individual event. we have had -- whether the bailout of penn central, the bailout of third world debt, savings and loans, mexican bailout, long term capital management. can you talk about the role that -- all those bailouts had in terms of behaviors within these banks? >> guest: those bailouts were really open invitations to have

another crisis, because if you risk money and it either isn't yours to begin with to take that risk, or you know someone else, i.e., the government is going to -- the taxpayers are going to have your back, and your consolidating and merging and increasing your base of deposits and capital you can work with because you're getting more and more citizens' money in as well, you tend to do things that are stupid, and that are reckless and illegal and -- or some combination. and the s & l crisis was an example of deregulation in certain types of financial instruments and services that enabled speculation at the time and mortgages as well, which we saw repeated in the subprime crisis more recently. but the third world debt crisis was showing bankers they

stonewalled washington and said we have these bills of dollars on the hook these countries are right next to us. if you don't help us, don't then to the world bank, supposed to be an independent institution help us, everything is going to go to hell and the american people will suffer, and so this idea of, if you don't help us, the americans will suffer so help us, but we won't help back, was manifested by all of these bailouts, and by presidents, from reagan through bush through clinton through bush through obama, who just really got on board with that. and -- >> host: they continue my play the card. help us so we can help them. >> guest: yes. and that obviously doesn't happen, and we're still bailing out the big six banks because of the way the federal reserve works. the quantitative easing, the fact the federal reserve continues to buy securities from these banks suppose ledly -- six

years almost after the crisis happened? that's a tremendous amount of help. the government -- the government is helping everybody pay their mortgage instead of buying mortgage securities from the banks, it would be a very different stability in the overall economy rather than of the big banks. >> host: yep. well, then, let's compare and contrast, then, if we could, the regulations that were put in place back in the 1930s post the 29 crash, versus what we have seen here post the 2008 crash with dodd-frank. what's your take on that. >> the glass stiegel act passed in 1933 after fdr came to power was a very clear line between speculative things the banks could do and the deposits it took and services it provided to regular individuals and small businesses. a very, very clear distinction, one does not connect. and as i mentioned before, the

key bankers of that time, two of them actually, winthrop aldridge and james perkinses, friends of fdr who came in to run national citibank after charles mitchell was so a crook, was also on the same pain as fdr. one fascinating thing i found in the fdr papers was that they had meetings, dave perkins was at the white house three day after the inauguration, talking to fdr about how he would split up his bank first. he would tell this shareholders, this us how it's going to go to. and he did. and so did aldridge, before the glass stiegel act was actually signed in the summer of 1933. so, that's what happened. there was a fine line between betting and traditional services. the bankers were on the same side as fdr, the population was on the same side as fdr, and

things became stable for many, men decades, several decades after that. contrast that tot what happened in the wake of the 2008 crisis which has been a much more expensive crisis for the general economy, for the actual unemployment level, not the sort of tag line unemployment level, for what was lost to individuals throughout, and relative to the bailouts and the subsidies that have been given since, and dodd-frank came along and did nothing remotely like dissecting speculation from depositors and traditional banking activities. deposits and loans. nothing. it's really, really, really long. has lots and lots of pages and does absolutely nothing significant. so a huge difference. >> host: do we have the political will? do we have the leadership in your estimation in washington, to take on that battle?

>> guest: no. i mean, we have -- president obama, basically said it was sweeping reform. so if you can look at something that is not sweeping reform, and compare it to something that fdr did, which was sweeping reform, and say that with a a straight face and have your treasury secretary, tim geithner, say that with a a straight face, then no, we dent have a leadership that would do anything, hasn't done anything to stabilize the situation, yet is pretending it has, which is more dangerous than not doing anything. i don't see anyone coming into play right now in terms of the potentials we have or that are being debated in terms of who might run for president in 2016, that would change that at all. so, we don't have a leadership that is asking something of those relationships, even if they're left tight, left without family connections, even if they

have more lawyers and lobbyists in between, there's no demanding, and there's no giving because there's no demanding. >> host: that's a dangerous proposition. >> guest: exactly. >> truly incredible. just a couple quotes from the book. what is your take on the following quotes: first off, he who controls the money supply control this nation. >> guest: this is what we have right now, with the big six banks today. we have a money supply that the federal reserve is technically in charge of, but what it has done in its policy, it has bought over 4 trillion worth of securities from the banks, or treasury bonds on which the fed pays interest to the banks. so, they have a say in rates. they've made rates close to zero percent for the longest period in u.s. history or the history of the fed. but the control is retained by

the banks that get in the money to receive the assistance. couple that with the fact that today there's more concentration of capital in the hands of fewer banks and fewer bankers running them than there's ever been in our history. and you're not just controlling the money supply. you're controlling the capital. 84% of the deposits in this country insured by the fdiy reside at the top six banks. >> host: 84%. >> guest: 85% of assets, 96% of the derivative exposure, six banks in the united states. they control 45% of the derivatives exposure in the world. that's a tremendous amount. forget the political financial phone calls to the white house visits and invitations. that is a tremendous amount of capital to be in charge of. >> host: sounds like a -- >> guest: we have only emerged -- when i aemerge --

only continued ounce from the crisis of 2008 to have these sort0s worse statistics than we had before and have big banks bigger than they were before, controlling more than they did before and that's a very, very unstable, scary proposition. >> host: obviously the elephant in the room in terms of too big to fail. what's your take on too big to regulate, prosecute, and trust? >> guest: yes. too big to fall to big to rein in. and as you said before, there are no leadership at the highest echelons to do anything about it. >> host: that's very troubling in chapter 16 you write, quote this really grabbed me -- no longer was there even a pretense of alignment with domestic concerns or collaboration with the white house. so take that quote, relative to what we had coming out of world war ii, that is pretty strong

statement. >> guest: yeah. and i don't remember if i said that in the seven -- exactly what year was in the '70s that quote came from. but i was referring to. but the fact is that that disalignment that we have used the government for what it's worth, we used to have this sort of relationship where we would give and there would be a give and take, and we don't need that anymore. we'll just take, and the government really receded into a position of having less power as the consolidation of capital became more and more concentrated, the power base shifted back to wall street. i had been that way the panic of 1907 when teddy roosevelt asked jp morgan to save the country. in the late 1890s the morgan

bank had more money than the treasury department. >> host: we've come full circle. >> guest: then it was like real gold, real money. now it's leveraged capital. all sorts of more complicated money. and with broader power. than back then. >> host: to that point, the power, and often times power is equated with often times arrogance. there's one quote in the latter part of the book that grabbed in and some people in the public heard this quote: that's why i'm richer than you. >> guest: yeah. jamie diamond. in an internal call with some analysts at chase, and the impetus for the quote -- what it means and says, this isn't about a greater good. it's not about a public interest. it's not about even a profit

motive being sustained by something reasonable. it's about my ego. and my money as it feeds my ego, and my power as it feeds my ego, and you bring that interest the equation, and that's just part of why it's all so much more dangerous now there was a fellow who ran chase back in the '30s, al wiggen, who had quite a big ego and was chucked out when winthrop aldridge came in and he didn't work to run the bank anymore. so there was a humility that existed after that depression and into the wars that doesn't exist whatsoever at all anymore. >> host: that's truly troubling. early 1900s we had the six large banks dominating the market place. we still have now six large banks but in the interim, there had been endless numbers of

mergers. has there ever been a merger that major bank hasn't liked? and whatever happened to the sherman and clayton antitrust act in the world of major banking? >> guest: it all goes back to that panic. what happens after the panic of 1907 is very significant because out of that came the federal reserve and out of that woodrow -- been interesting story about jp morgan's son was called to the white house after cam pinning on the notion of breaking money trusts run by people like morgan because there was a war coming on, and all sorts of speculation in the press at the time, why are these guys going together? why is morgan at the white house? what is wilson doing in and turned out a couple months later they war trying to figure out how to finance a war and very much on the same page. and we now have that situation

where there's nothing to keep that page. >> host: clearly seems -- i mean, with such -- as you were just referencing, the percentage of capital and deposits and derivatives and assets in such few hands that it allows for ultimately manipulation and scandalous activities within the markets? which is why you need actual defined, well-defined structures to at least be unquestionable and unlobiable and unlawyerable against in order to at least create less risk to everybody necessary the general economy. that should be -- you talk about a government is supposed to protect the citizens of the country. well, it's not just about all the money you spend on military. the government has and should have a responsibility to protect

the country from the standpoint of its economic well-being. and in a situation where the concentration of wealth and power and influence and capital is so out of whack, then a government that is allowing that presidency, any presidency that is allowing that to happen, is not doing itself best by the american people. it's not doing what would be best in the interests of a true democracy. >> host: the question begs, does it really matter who sits in the white house? >> guest: these last several decades, it really has. from this standpoint. you talked about all the various bailouts, all the crises happened in between, internationally, between the third world debt crisis, the mexican peso crisis, the s & l crisis and all of this happens whether there's a republican or

democrat in the white house, regardless whether the treasury secretary is a republican or democrat and who is running the fed. so it hasn't mattered. >> host: hasn't mattered. this has been fabulous. we have three or four minutes left here. let's try to look forward to the future. obviously a lot of unknowns. we're sitting here at a point in our nation's history which, having come out of the crisis of '08, kicked the can down the road, lots of issues, what would you like to see and how are we going to make that happen? >> guest: i'd love to see true leadership out of the oval office with regard to the issues we have been discussing here today. i love to see a return of the glass stiegel act north pretend return, because there will all bess lobbying and permanent calls to ask for things.

a little more balance between what is required for the stability of the country versus putting all the eggs into the basket for stability for the largest banking institutions, and a real strengthening of america from that standpoint. that would be good to see. not go to see another crisis which is very likely what will happen instead because these things aren't happening. there's a lot we can learn from our history. it has some very bad moments and some really decent moments, and i think that -- that's one of the things i found in this book. the periods where things worked better are things we should accentuate, like move up from there. we can criticize them but we should look at them. but -- the things that worked worse for the general public, we should try not to do. and that was really one of my pain takeaways from the book, aside from the connections and just the anatomy of how power

relationships between work the white house and wall street and how they impact policies foreign and domestic, and what makes sense for the general public and the greater public interests, and do that more. >> host: well, regret publication seems those who have failed to learn from history are doomed to repeat it and there's a lot that has been repeated here, obviously leading to the crisis of '08, in your estimation, will it take another crisis to bring about chengs changes we haven't seen from this most recent one? >> guest: i think there's no way that won't happen. whether we get the changes after that crisis, i can't say. but it's astonishing to me that what happened wasn't enough, and that the fact that we are still subsidizing the banks that were involved was -- is very

incredible to me and we need to be in a better place. >> host: well, nomi, can't thank you enough for the incredible work you put into this book. you have done a national service, and for those who-watching this show, please read the book, share it we friends, family and colleagues. congratulations on a fabulous piece of work. >> guest: thank you so much, larry. >> host: okay. >> that was after words, booktv's signature program in which authors of the latest nonfiction books are interviewed after words airs every weekend on booktv at 10:00 p.m. on saturday, 12 and 9:00 p.m. on sunday, and 12:00 a.m. on monday. you can also watch after words online, go to book of.org and clock on afterwards in the topics list on the upper right side of the page.

... the 30 minute interview as part of booktv's college series.