Bloomberg asked, “What Happened to Banker Bashing?” It quoted me out of context after an hour-long interview:

“’People have not forgotten what happened in 2008 and we will hold bankers’ feet to the fire,’ said Janet Tavakoli, a Trump backer and president of Chicago-based Tavakoli Structured Finance Inc.”

Bloomberg selectively chose a sound bite. Of course individual law breakers should be prosecuted, but that’s not the most pressing overall issue. Dodd Frank “reform” and the misnamed Consumer Financial Protection Bureau are ineffective. I’m all for repeal and replace.

As I explained to the reporter, the way to “hold bankers’ feet to the fire” is to restore the Glass-Steagall Act. Separate commercial banks that take in deposits and provide loans from investment banks that sell securities and speculate. Remove all possibility of Federal funding, subsidies, and bailouts for investment banks. Restore bankruptcy’s ability to wipe out credit card and student loan debt. Capital for traditional banking should be increased.

Change the incentives, and behavior will change.