Senator Elizabeth Warren, the Massachusetts Democrat who is arguably Wall Street’s harshest critic on Capitol Hill, has said restoring
Glass-Steagall would reduce the risks bank pose to the economy by creating a “wall between commercial and investment banking.”
“Despite the progress since 2008, the biggest banks continue to threaten our economy,” Ms. Warren said in a statement.
2 executive at Goldman Sachs, Mr. Cohn is not the first administration official to signal Mr. Trump’s support for restoring some version
of the New Deal-era Glass-Steagall Act, which forced the separation of deposit taking from trading and investment banking activities.
Goldman, said Dennis Kelleher, president and chief executive of Better Markets, a group
that advocates more restrictions on Wall Street, “would be king of the financial world where bank holding companies couldn’t compete.”
If anything, the proposal to restore Glass-Steagall shows the shifting sands of Wall Street’s position in Washington.
In a meeting on Wednesday with senators from both parties, Gary D. Cohn, Mr. Trump’s chief economic adviser, said the administration was considering a proposal
that would require separating retail banking from investment banking and trading.
Others warned that breaking up large banks could benefit firms like Mr. Cohn’s former employer, Goldman Sachs, whose retail deposit business is relatively recent
and small: It would have a greater impact on Goldman rivals like JPMorgan Chase and Citigroup.
“Large financial institutions play a role in the American economy other institutions are not able to fill,” said Tim Pawlenty,
the chief executive of the Financial Services Roundtable, an industry group, and a former Republican governor of Minnesota.
