designations or even to some degree activities-based sifi analysis. who wants to comment on that? maybe chairman gruenberg you might comment on that since it's a banking and a non-bank designation question. >> congressman, we -- as was discussed earlier, the fsoc established a process for a sifi designation pursuant to rule making and public notice and comment. i think the rule making went through three series of public comments and the first stage of the process, as i'm sure you know, is a set of metrics, a set of thresholds through which an institution would pass and i must say there are a very high set of thresholds which almost by definition would be limited to some of the largest or most interlinked companies in the financial system. and that is something that's -- any company can calculate in terms of projecting what the impact might be. >> time of the gentleman has expired. the chair recognizes the ?> thank you, mr. chairman. first of all, thank you for being here. i know everyone is excited about the holid

even established that an asset manager should be an sifi. >> yes, sir. we have not designated any asset managers as sifis. >> they learned through a "wall street journal" article. don't you think it would be more prudent to allow these asset managers to have the ability to correct whatever may be wrong so they can save not only the financial system but also those with whom they serve and instead of waiting until the opportunity that a collapse may occur which you seem to foresee? >> that's a point of view -- >> if i went to the doctor, i would want to be diagnosed and treated then, not when i was on the life-support. i yield back. >> i recognize the gentleman from washington, mr. hick. >> mr. woodall, i think i would like to direct this to you, if i may, please. over the last -- i'm over here. over the last couple of years we've heard a lot of witnesses, and no small number of the members of the committee indicate publicly and explicitly that receiving a sifi designation was locking in an unfair competitive advantage. it seemed to be premised on the idea

what are we doing here designating asset managers as sifis? when in fact they are basically brokers. in fact the impact it will have on mom and pops, now they'll have to pay fees in order to justify why they're brokers with a sifi when we have not even established that an asset manager should be a sifi? yes, sir? >> we have not designated any asset managers as sifis -- >> they learned through a "wall street journal" article. don't you think it would be more prudent to allow these asset managers to have the ability to correct whatever may be wrong so they can save not only the financial system but also those with whom they serve and instead of waiting until the opportunity where a collapse may occur that you seem to foresee? >> that's a point of view and these are are the -- >> if i went to the doctor, i would want to be diagnosed and treated then, not until i was on life support. i yield back. >> the chair now recognizes the gentle lman from washington, mr. heck. >> mr. woodall, i think i would like to direct this to you, if i may, please. ove

designations or even to some degree activities-based sifi analysis. who wants to comment on that? maybe chairman gruenberg you might comment on that since it's a banking and a non-bank designation. >> congressman, we -- as was discussed earlier, the fsoc established a process for a sifi designation pursuant to rule making and public notice and comment. i think the rule making went through three series of public comments and the first stage of the process, as i'm sure you know, is a set of metrics, a set of thresholds through which an institution would pass and i must say there are a very high set of threshold which is almost by definition would be limited to the largest or most interlinked companies in the financial system and that is something that any company can calculate in terms of projecting what the impact might be. the chair recognizes the gentlelady from utah, mass love. >> thank you, mr. chairman. first of all, thank you for being here. i know everyone is excited about the holiday season, i want to wish you all a merry christmas. and also to

should it be a sifi? let me just go on to mr. gruenberg. in the dodd-frank act congress recognized our banking appropriately engage in regulatory oversight of large banks leading up to the crisis. as such, we put in place enhanced prudential standards to set forth the basic requirements for a bank to be well run, capital resolution, risk management, among other factors at the same time the deliberative process in congress led to an exemption from the requirement. they were to provide the fed with the option to exempt several banks from certain requirements. both in committee and through potential riders to funding bills, congress has now contemplating legislative proposals that would undue this work. these proposals would rely on the financial stability oversight council to affirmatively designate banks for enhanced prudential standards for all but the very largest global mega-banks. do you think that such proposals would be ill advised? what did the 2008 financial crisis teach us about how the failure of one or more large regional banks co

what are we doing here designating asset managers as sifis?en in fact they are basically brokers. in fact the impact it will have on mom and pops, now they'll have to pay fees in order to justify why they're brokers with a sifi when we have not even established that an asset manager should be a sifi? yes, sir? >> we have not designated any asset managers as sifis -- >> they learned through a "wall street journal" article. don't you think it would be more prudent to allow these asset managers to have the ability to correct whatever may be wrong so they can save not only the financial system but also those with whom they serve and instead of waiting until the opportunity where a collapse may occur that you seem to foresee? >> that's a point of view and these are are the -- >> if i went to the doctor, i would want to be diagnosed and treated then, not until i was on life support. i yield back. >> the chair now recognizes the gentle lman from washington, mr. heck. >> mr. woodall, i think i would like to direct this to you, if i may, please. over t

know there's been a great, great deal of discussion this year about how the fsoc could improve its sifi designation. one of the suggestions that i kept hearing and probably you heard also was that the fsoc should tell companies what actions they needed to take in order to avoid being designated as a sifi. and this sort of struck me as a dubious idea because do we really want the fsoc to be making these kinds of core business decisions for private companies? and my opinion the fsoc should identify the systemic risk, and then the company should figure out the best way to restructure its business to eliminate the risk. and when the council adopted changes to the designation process in february, you decided not to include this suggestion. can you elaborate on why the council wanted to maintain this distinction, and do you think it's important for the fsoc not to use the designation process as a way to tell. companies how they should be run? >> well, speaking for myself, i largely agree with your assessment. i don't think fsoc should be telling companies how to structure their business. i th

the bank of england sent a letter asking why berkshire hathaway is not considered a sifi. i think barack obama said he was a great friend. is there a political analysis and connectivity with people in power that go into the designation on fsoc? >> not from me. >> anyone? >> i yield back. >> the chair now recognizes the gentleman from california, mr. sherman. >> thank you. >> folks, i do think your decisions are life and death. you'll never meet the people. we have another 2008, every one of our districts will have higher divorce rates, higher unemployment rates, higher drug use rates. and we will never be able to go to a particular funeral the way you can in san bernardino and say, this is what happened. you there are thousands of americans who would be alive today if we didn't have the 2008 meltdown. so your work is every bit as important as those who are focused on terrorism. the -- ms. white, we've got the financial stability board. we don't have -- well, we have one of its members here. but it doesn't answer to you, the american people. how can we be sure that they don

should it be a sifi? let me just go on to mr. gruenberg.in the dodd-frank act congress recognized our banking regulators failed to engage in regulatory oversight of large banks leading up to the crisis. as such, we put in place enhanced prudential standards to set forth the basic requirements for a bank to be well run, capital resolution, risk management, among other factors at the same time the deliberative process in congress led to an exemption from the requirement. congress also directed the fed to tailor certain regulations for large regional banks based on size as well as provide the fed with the option to exempt certain banks above $50 billion from certain requirements. both in committee and through potential riders to funding bills. congress is now contemplating legislative proposals that would undo this important work. these proposals would instead rely on the financial stability oversight council to affirmatively designate banks for enhanced prudential stand d standards for all but the very largest global megabanks. chairman gruen

carter made a surprise visit to baghdad trying to the sify the fight against islamic state group. carter's trip is just after the to send elitelans american troops to iraq to onduct raids against the islamic state there and in syria. as air strikes against the islamic state group continue in syria they have lost patches of mportant territory. one is sinjar. forces have merga discovered a network of und underground couples that were the i.s. group. we have more. the iraqi town of sinjar seems to be little more han a pile of rubble but jihad eurtss were able -- jihadists were able to hold out despite pounded by air strikes. these kurdish fighters liberated town. they show us around one of many ouses left in ruins where the islamic state group left their trace. their graffiti. they also built tunnels to bombs.t themselves from reporter: the tunnels are almost bolstered by h sand bags on the sides. further three meters underground the women are tread. where at the jihadists are known to leave land mines behind them. a bedroom like in a real house. reporter: an underground city ooked u

you've seen since the crisis the big eight, the big global sifis going in one direction but renal nallks going another. >> you should have a low cost to capital. >> they do. the bigger banks have to have more capital because of this sifi buffer. >> does nobody want our savings? why is it -- why is it that the federal reserve can raise interest rates but we don't get that back on our bank accounts? do you not need the cash that savers have? >> you know, it's interesting. i think that banks -- competition will drive the rates that banks will pay. it won't be immediate. as loan growth continues to grow, loans grow, overtime the bank industry will have more of a need for funding. the banking industry has been awash in deposits and it's unusual because of the global financial crisis. until some of that liquidity gets used up, you won't have that competition. it's coming. the question is when. >> when is the wave of lending going to come. former cfo of citi was on last week, she said the classic thing is that they would throw money and loans at people once you realized interest rates were ri

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its designate of nonbank financial institutions as systemically important financial institutions or sifis by acronym. it anoints institutions as too big to fail meaning the designations are tomorrow's taxpayer-funded bailouts. designation ominously grants the federal reserve near federal reserve near de facto management authority over such institutions, thus allowing huge swaths of the economy to be controlled by the federal government. members of the council can raise the prospect of a designation and eliminate entrepreneurial risk taking, innovation and growth from our economy. as a result, americans may find themselves paying more to ensure their homes and families. investors who relied on mutual funds to save for their children's education or retirement will find they have earned less. fsoc is charged with identifying emerging threats to our financial stability but refuses to look in the mirror. in its latest report, it omits any references to specific government policies or agencies as helping caused the systemic risk it identifies. greater risk taking across the financial system is

and third, the fsoc re-evaluates within calendar year 2016 each previous sifi designation and rescinds any such designation if it determines that the non-bank financial company no longer meets the standard for designation that have been brought forward. just would like to get your reaction. would that legislation prevent fsoc from doing its job? >> i was waiting to see what the question was going to be. would it prevent what now? >> fsoc from doing its job. would that seem like a reasonable proposal? the company that will be designated or entities that are designated, non-bank sifis have some way of understanding why it is they're designated that way and and off ramp that would allow them to determine -- >> that was your third point. it seems to me that's what we're working for right now. to try to get more clarify in what that exit ramp is. i have submitted a list of 17 different options for the fsoc to consider. it's now being submitted by their deputies. there's ways to clarify that where it can be much more clear to the company what it needs to do. the company says tell us what we'