Thomas Hoening – the longest-serving Federal Reserve policy maker, a voting member of the Fed’s main policy-making body (the Federal Open Market Committee), and President of the Federal Reserve Bank of Kansas City – told Shahien Nasiripour that the claim that the U.S. needs megabanks to compete globally (as made by Jamie Dimon and others) is nothing but fantasy:
That is a fantasy — I don’t know how else to describe it. Our strengths will be from having a strong industrial economy. We will have financial institutions that are large enough to give us influence in the markets but not so large that they’re too big to fail.
The outcome of that is that strong banks [and] strong economies bring capital to themselves, and they are by themselves competitive.
The United States became a financial center not because we had large institutions but because we had a strong industrial economy with a good working financial system across the United States — not just highly-concentrated in one market area [i.e. Wall Street].