takes a pillaging black tuesday. she joins me today to discuss all the presidents banker presie hidden alliances that drives american power. welcome and congratulations on such a fabulous book. as we take a look into washington, wall street, and the families that have had such an enormous impact on our nations and the world. >> guest: thank you so much for that lovel the lovely intro. >> host: my pleasure and it was easily done again, given a fabulous career that you have had to move on wall street and now off wall street in the literary world it is a pleasure to have you. let's dive right in. this is an incredibly unparalleled in history of the relationship between wall street, the large banks that have dominated the nation in washington. what motivated you to take on such an incredible amount of effort and exercise to produce this book? >> guest: a slight bit of insanity i guess. but actually, the novel that i had written, black tuesday, which was on the clash of 29 had a scene that i have researched, nothing near the research i did on this book on six bankers that have gotten together in the house and on 21 wall street to decide to try to save the markets that were crashing around them in late october by themselves and a fellow named tom lamont at morgan bank at the time, the chair jack morgan was elsewhere gathered at the bankers together into powerful families of painters an dangerst powerful banks on wall street to say we need to do something to see these markets and they decided with just 20 minutes to throw in $25 million each into a buying pool to go and buy a lot of stock and basically by themselves try to boost its market that was falling around them and i found that fascinating as these big banks and i started to notice today we had six bankers and i looked back in time of the analysis and there were six banks on hundred years ago in the panic of 1907 that were largely the same banks in the first part, they were now similar legacies. but i started to wonder what is the relationship. and i was fascinated and the other works i done at the political association of bankers and so what i decided to do is take a look at the histor histon period and look at the real relationship between the bankers, whoever the most important one was at any point in time in the nations history and what their connections were to the presidents. and what i found, because i didn't know that every single president since teddy roosevelt to barack obama had a strong associations. but certainly with a subset at least i've got six bankers through documents and letters and phone calls and all sorts of other forms of communication as well as social and harvard and other types of places where they would meet. >> host: clearly the relationships are everything whether they want to promote them or not. but take a step and go behind the scenes. could you take us into your research? where did you go, who did you meet to unearth the truly incredible material? >> guest: i decided to go to all of the presidential libraries to make the research easy and start from the president out whether they had associations with particular bankers comes over every period of time i wanted to make sure that i had the appropriate events that would have occurred at that time. for example i used to joke with my editor and say i don't want to forget that world war i happened. i don't want to forget about vietnam, so i had outlines of major events that happened and each president of course and treasury secretary. and i went to all of the archives, all of the presidential archives that existed throughout the country. for example in kansas and one half 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 obj and i went back several times throughout the period of research because i found that period very critical in terms of relationships into changing attitudes in america between the presidency and bankers and the citizens and so forth. and i really just dug in deep and i did as well but i would find in some cases i had to submit acts to unearth certain documents for the more recent presidents of it hasn't been unearthed yet and in some cases for example the ronald reagan library in california the archive really kind of took my projects to hard 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 you research they bring out the boxes and it is almost like a race. you know, you're going through the boxes what can i find. and there can be anything. so it could be anything from letters about, you know, why did you drop the atomic bomb letter is from bankers saying thank you very much for your support and handwriting back saying i couldn't have done it without you. there's all sorts of things you find a and q. just to get into this mode of being in that time and that president into those kind of people going through these amounts of documents and then a sort of typing everything up while you're there and editing throughout the process and then sort of going on to the next location. >> host: were there any that you deem to be somewhat reluctant to share information? >> guest: from fdr until the ronald reagan library in a, there was a certain code under which everything is classified. for the military information, finance information from economics, personal relationships come and it's a very clear code and identification and very almost easy to access information. the carter library i went there shortly after the film came out and there have been a whole team of researchers down there slightly before the movie looking up information about the iran hostage crisis and you could actually go in and look digitally at a lot of documents. not every library has that. but in some of the more recent libraries like the clinton library there is little been and that is for the announce of information. plus now you have e-mails and everything needs to go through security clearances and it's in a different code. it was a lot harder to find information. the reason i could find it in the ronald reagan library is because she kind of new difference between the new code into the old codes. but i still have stories outstanding in the clinton at tn library and outstanding at the george bush library in texas and of course the george w. bush library opened so i didn't have the opportunity to look at anything there. >> host: was there a point in time when the story started to sharpen in terms of the nature of some of these relationships where you started to realize while, this actually goes deeper than perhaps either your self as well as the public would have imagined or might even still imagine? >> guest: yes and because i didn't really far at the beginning i kind of looked more on geography and the flight pattern. i was doing a little bit of jumping back and forth and so for example i would go to the lbj library and i would see his relationship with sandy weinberg was thwho was the chairman of gn sachs at the time and at the fdr library to see how they have been very close friends because something lbj had decided during the 60s -- we were both fdr men back then. it's good to have you on my team again. of course they were just on the same team, and then when i went to the fdr library to see for example the beginnings of that relationship. so, a lot of times starting in the middle of history and going backwards allows me to then catch up in the middle and go to the same bankers and to see what the relationships were with all of the presidents in between. and what i found in many instances is that you have a relationship with many. and going back even further in time i mentioned in the beginning how tom lamont was the chairman at the j.p. morgan in the crash of 29. i knew that from black tuesday. but i didn't know and i found this out at the fdr library in hyde park which is near where i grew up. i'd gone there as a kid but certainly not as research. he actually had rented out his townhouse on a 65th street manhattan to thomas law and 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 was president had started way back. they had gone back to harvard. they had both been involved in the crimson harvard paper over there. thomas lamont had actually been one of the editors, very young editor when he was at harvard and a heavy very long history, which then lasted through several decades. and so, you just kind of -- there was this kind of effect where it was history going backwards into there were a lot of decades in between. >> host: so the relationships really went from not only the business end of the political but often into the social as well. >> guest: exactly. one of the other bankers went from suzanne in the great depression who was a friend of roosevelt and he was also one of his votes won in the 1930s or something like that so yes. so there was all of that going on back then as well and fdr and his sons were interested in that answer, of course then j.p. morgan had a tremendous fiat at the time comes where the equal the length of what we have now with 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 in 1938 fdr had this point appointed a well-known family name joseph kennedy two b. the first head of the fcc when it was created and also he was the ambassador in the late 30s after kennedy was the head of the fcc. so he is having a coming-out party with his daughter who died in another kennedy tragedy but a young john f. kennedy was at that event. david rockefeller, who was part of a long history of the industrial financial family strength was also there. in fact, he somewhat dated kathleen kennedy for a minute back at the time. so at the time these connections were all sorts of social events that people wouldn't be involved in. >> host: so it isn't just the social individuals but as we were just eluting t to come up e strength of the families as well. and the family ties run deep from the morgan and rockefeller and kennedy. >> guest: they were immensely famous and powerful creative together among a few other established families in new york which was a very exclusive club where these men could get together and talk about affairs of the day and decide things in a very small and tight environment. >> host: it is on royalty almost. >> guest: it really was even when you do get out today how it is used for the throne of the hierarchy of the young terms that we use even in the industry and banking today. who is the heir to the throne of j.p. morgan chase? so even the terminology has that sense of monarchy. certainly back in the beginning of the 20th century and throughout, a good portion of that there were only three or four families that were the most instrumental in running the top three financial institutions the country that also had the tightest personal and financial connections with the presidents that were i in that time althouh in some cases the differences were that these people don't get elected they are the family appointed. one of the other families running the national city bank in the part of the 20th century and of course the national city bank is part of what we know as the citigroup. he had two daughters and they married the two sons of one of the rockefellers and together they produced the rockefeller then ran what was city bank in the late 50s and early 60s. so these lines -- >> host: >> guest: sometimes money where they were connected. >> host: i guess when you combine all of them, blood, money, power committee on -- >> guest: game of thrones. it ends up in an incredibl incre book. let's go back towards the beginning of the book. set the scene for us please. we go off the coast of georgia to a place called jekyll island. what happened and who was involved, what came out of it and were the motivations of the people in your opinion, would each really pure and sincere? >> guest: what happened was in november of 1910 there was a meeting that was called by senator nelson aldrich. aldrich is were also very famous and powerful political families that integrated into being a political financial family. and they'll send aldrich as the finance chairman was tasked with trying to create a central bank that would appease the public as well as pass politically in washington. and the reason for that was there have been a panic -- a major banking panic in 1907 a few years before that. at which teddy roosevelt had asked j.p. morgan to get his people together to try to save the market. and it was the government calling the bankers to try to help the general economy. and after that panic and after j.p. morgan got a bunch of his friends together to decide which banks or trust companies could live or die and how much money each had 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 adopted this idea of having the central bank to help subsidize or stabilize them so that they wouldn't have to put their own when he and whether or not they have caused a panic. and from a government standpoint, teddy roosevelt didn't talk about it so much, but when they came in as the president, he very much pushed this idea of having the central bank and the aldrich family that was close to the taft family basically decided that they would do these expeditions into europe and see what was going on in the bank of england and with france and see if america couldn't duplicate something that was more american but still enable them to have a powerful central bank and also to back the emerging currency was going to be the most powerful currency in the world, the dollar. dollar. it's a fast-forward a few years in the fact-finding and the traveling around europe and nelson and aldrich went around quite often as the head of the national city bank and he got back and of course feingold blocks of documents at the official level. the jekyll island happened because it was time to make it official. and j.p. morgan said you know, you need to do this somewhere someone privately only after nelson aldrich was hit by a car on madison avenue. he was in new york and discussing things with bankers. his son did in new york as well, and he got hit on 60th street by this madison ave. horse. he didn't plan to have a big meeting at his estate in rhode island, but now he's in new york and he's with bankers and morgan has a club membership at the jekyll island club off the coast of georgia and really sponsored, which is something i found out when i went, they sponsored this again to work at the secrecy to bash out this idea of the fed. now the sort of cloak and dagger stuff i think is a little bit exaggerated. i mean it wasn't like you have paparazzi sort of flying in them. and it is generally at the time it was off of coast. you couldn't really get their. they would come in to make sure they couldn't even dock near the island. so that is really the plan. and at the end of them bashing out of this plan he's going to go back to washington to present it to the senate and what happened is he still wasn't feeling well from the trolley car situation. so wha what had occurred as theo of the bankers that have been at the meeting, frank who was the number two at the national city bank and henry davidson, who was one of the senior partners at the morgan bank actually presented the plan to washington, which i didn't know either. this is something i discovered another. so they planned this whole thing and they actually went to washington to present the findings. the actual federal reserve act was passed ultimately under woodrow wilson looked a little bit different from that plan. but it had a lot of similar aspects. the idea of the central bank, the concession is that there would be a new york fed that would be close to the wall street banks and then there would be the federal reserve, which the president would appoint the chair man and so there was kind of this idea of a balance of power and everybody was happy and if there were a whole bunch of stuff in the book about all of the enumerating is at midnight and 1 a.m. in the white house until they finally did get passed and signed. >> host: clearly the federal reserve is a lightning rod currently give given them of the quantitative easing programs that are going on right now. but right from its outset, it's always been promoted as an independent institution. in your opinion, can it be independent giving the nature of the relationships as you have laid out? exquisitely in your bookmarks >> guest: it's really nice to think that it can be independent. number one because the very structure has a number of banks in the federal reserve banks serving only shares as a full entity, so that is number one. there is an even ownership type of relationship. but beyond that, the philosophical relationship which is a strong one that started back on jekyll island and has gone through the day has actually been strong with the first he was one of those that t had been at the jekyll island to say he was the head of the new york fed and then paul who was another of the men who was at jekyll island that morning was appointed by woodrow wilson to the one of governor the governoe 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 and why it was established into the appointments that were allowed and physically done it hasn't been a suggested appointment that's come through a president that hasn't been accepted by congress supposed to have an extra saying in this. every time a president wanted the helm of the federal reserve it happened in 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: it remains a fascinating topic and again, always the call for transparency relative so there's certainly more to be studied there. >> guest: he did such an exquisite job on not that i have it. >> host: obviously having studied extensively, the president as well as the bankers, in your opinion had there been a couple of presidents either who really stood out in your eyes as just being a truly magnanimous in the way that they've executed your office or on the other end of the spectrum willing to turn over the range of power to the bankers? >> guest: back in the 20s before the crash of 29 we had a pizza session of presidents from harding through calvin coolidge through herbert hoover all of whom just allowed the bankers to do what they do. not just for financial power but for america's emergence as a political superpower that if you had to banks that could expand, to basically do what they said they needed to do to become strong themselves and that was good for america in general, which is actually a theme that continues to exist through today that is very specific because of the emergence of america the superpower. calvin coolidge did nothing to thwart any of this. he was famously talking about how in the business of america is business but also his treasury secretary can actually treasury secretary that served for harding and coolidge and hoover andrew mellon was himself a banker and deleted it was important to allow the banking community to do what it needed to do which meant not having any real rules and they ultimately resulted is a tremendous amount of speculation after world war i that ultimately led to a tremendous crash, which ultimately led to the great depression. so those presidents at relationships, but they didn't really try to use them to get anything back from the bankers. just going through in history, lbj was someone who didn't really come from the same establishment on the societal connection as some of the main bankers as his time, that he was such a master politician that he understood how to sort of throw the personalities and the positions of the people in the power and drinking at the time as well as get stuff done. so, he was very much a man about you know, i will -- i will not restrict you. i will not worry about fewer competitors iyourcompetitors ins of the financial service firms twho think you have to much power. i'm not going to play in any of that, but you need to support my great society. you need to not see anything negative in the press. you need to be on my side. and that even continued into the beginning of the vietnam war there were a lot of bankers that raised money and that and they subsequently turned against him and things started to unravel towards the beginning of the second term, but he just knew how to use the relationship to work for a broad public interest as well as allow the ideas of the 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 also did a lot of that when he worked on his policies. >> host: with stickers that topic. in the 20th century we had the two great wars, we had the vietnam war and then also the cold war. what sort of a role did the banks and the bankers play in terms of the nation's involvement both pre- and postwar? >> guest: it goes back to the woodrow wilson relationship back during "-begin-double-quote war one. first the bank itself worked with wilson and the treasury secretary at the time to finance 75% of the private investment that went into the funding allies for the war related arsenals and so forth so there was already a strong alignment between the morgan bank and the white house, very regular and very much an idea of the money that's needed to go into the effort was going to be consolidated through the private bank. and then of course where the individuals across the country were asked to invest in america and so forth and that helped them go because they have more customers after them and then the second world war, they sort of tried to do the same thing. there were some different people at the homes of the major banks and at this point, he really stepped into the forefront because of his relationship with fdr and the chase bank as well as citibank there was a relationship with the vice chairman with morgenthau who is thwasthe treasury secretary undr and world war ii vet allowed to these institutions to continue the private financing of the war but also a much larger blanket approach to getting individuals to buy the war bonds and to take out accounts of the banks of the same time so that is the way that they sort of combined helping in the country and expanding their presence and getting the new customers. but then by the time that you got to the war all of these customers are there and the policy under truman and eisenhower was to make sure that the communism could not prevail and capitalism would be the dominance and it has doctrine he basically states america would stand ready to fight from a military perspective or an economic perspective were what he said was a trade perspective in order to protect its allies on the capitalist side of deflation. that helped the bankers because now they have military support to expand the branches into the country. and as a result of the beginning of the cold war, the expanded before castro came in and nationalized banks out of cuba. they expanded into beirut into the rest of the middle east and all of this wa this post on wase protection of the u.s. military. so, the whole idea, the whole reason on the international aspect of thinking have been particularly because of these major banks. there's a connection they had into the presidency to policies. and they were also on the pulpit to promote these policies. wenstrup eldridge went around the country talking about the truman marshall plan and helping and aiding the countries that were on the side of the u.s. and so forth. and open trade and free trade. so there was an extensive alignment is people that knew each other and had a similar interest and used each other to expand. >> host: truly fascinating stuff. so, you talk about the scent of a line meant and clearly coming out of the depression, there was this anti-banker you know, look what you just did to us in terms of speculation. you know, working our way into world war ii where there was a sense of collaboration. and you know, now it seems to have come full circle again. so it's this cycle of these ups and downs. you know, are the bankers in your opinion now -- how do they balance that profit motive and incentive versus the national interest? >> guest: that if something interesting to me in the buck and the fact that he's working to pass the banking and reduce the ability of the banks to speculate with depositors funds is interesting to me because he wouldn't assume on the surface that woulthat would have been tr the surface it does make sense because if we have a more stable economy for everybody. the banker that understands that his good come o of a ground-up stability is actually good not just for the country but also for his bank actually wins because today j.p. morgan chase is the most powerful thing in the world, certainly the most powerful bank in the united states, so the fact that he pushed his bank to be split up in the 30s because on the one hand you want to take over the competitors and have the bank that did that but on the other hand, it worked. j.p. morgan chase exists today. so a sort of gamble that worked out, that these guys were out in europe doing food drives and le monde spent a lot of time to raise money after world war ii to help the chinese that were impoverished and so forth, so there was a different mentality of what you could do for your country as well as balancing what you want to do in your own profit from the banks and working together with presidents to sort of have everyone aligned on the same page. we have several decades of the disillusionment of this in between that is nothing remotely like that. you can't imagine jamie time and running off with food drives to help anyone. so you know, it's a really different form of patriotism that existed then versus nonexisting now. and also it isn't demanded from the presidency. then there was this idea of i will do this for you if you do this for me. this will be good for the country. and now there isn't even an expectation. there is not a demand to have that kind. >> host: was there a point in time when you could pinpoint where the balance of power shifted in these relationships? >> guest: it kind of happened in two stages. one after the period of alignment between fdr through eisenhower where the needs of the political needs and financial needs and individuals were all on the same page and very closely connected in the conference and everything. you have a jfk, and of course he did the family base. he certainly had relationships with the people that were rising at the major banks. but they were standoffish about the idea of asking for favors and as a result they were not nice to him publicly. in fact, in 1962, david rockefeller wrote a very sort of -- they had a famous set of letters that were published in life magazine between rockefeller and a jfk where on the surface they looked like they were being collaborative but if you've read the text that sounds like he is critical of some of the initiatives of jfk. in particular with respect to latin america, jfk didn't want to fully have latin america opened to the private interest he felt that they should be pushing their leaders to be open or david rockefeller and other people that were coming into the folds of the major banks at the time saw this as a tremendous opportunity. and they had the commodities it was right next door. the branches were going up left and right and they really wanted the government to support much more of the private and others into jfk thought that latin america should be strong on its own so that was the kind of divergent but then of course he was fascinated and lbj came in and as i mentioned before, lbj first of all he was much more about sort of the private interest internationally. he much more supportive of the bankers wanted to do and he had many more personal -- he knew how to stroke their ego. there was a lot of back and forth between david rockefeller and between the members of the national city bank and in and out of the white house. he was invited to the ranch and had these monthly dinners in washington where he would invite a very particular or so 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 has more public support in the press and on wall street because he thought they would be supportive of what he wanted to do so again it goes back to connecting. nixon was a bit like jfk, which a lot of people wouldn't say. but from the standpoint of, you know, this collaboration, he didn't want any part of that. during two points of the presidency though he did suggest that the david rockefeller should become the treasury secretary, and walter should ask them to become treasury secretary they both said no they were busy expanding. and they were busy expanding. but also personally. obj would get on the phone and have an invitation how is your daughter doing. he didn't do that. and at that point they had gotten together and felt okay we can take the policy from here, and they actually pushed nixon and people in his cabinet to get off of the gold standard that happened at the beginning of the presidency and all sorts of other things that now they started making demands without feeling they needed to give anything in return, and there was a lot of stuff on the books thathat the band evolved into te middle east whale an oil and alf other things that came out of that this alignment. >> host: got it. so, was it your sense at that point in time that the bankers felt you know what, i actually have more power where i am currently situated van one might think >> guest: there was a consolidation because some of them have gotten away from that. so it was much more lucrative from the power and influence as well as the money standpoint. money wasn't even the thing. it was more about the power to not have to work on the foot of public international side. and having access to the petrodollars was also a big point of that approach because all of a sudden you don't necessarily need the backing of the military to open up branches you just have all of this extra money you can refund all around the world which it turned out went into the form of debt in latin america and caused a crisis of buildout by the government. so it started to really sort of dissect. >> host: let's stick with this whole concept of bailouts. we had a massive bailout in 2008 and the american public is, you know, never again. we can't do that. you know, just to stay away from it. and washington promotes we've taken care of that so we will never have to have another bailout. 2008 was not an individual event. we have had, whether it was the bailout of central or third world debt, savings and loans from th,mexican bailouts, long-m capital management. can you talk about the role that all of those bailouts have in terms of behaviors in the bank's? >> guest: those bailouts were open invitations to have another crisis. because if you risk money -- and it isn't either yours to begin with to take that risk or you know someone else, i.e. the government is going to were the taxpayers are going to have your back and you're consolidating the deposit into the capital that you can work with because you are getting more and more citizens money as well do tend to do things that are stupid and that iraq listed that are illegal or a combination of those things. and the snl crisis was an example of the deregulation in the certain types of financial instruments and services that enable lots of speculation at the time in the mortgage and ths well which were repeated in the subprime crisis. but it was a showing bankers that basically they stonewalled washington. we have all of these billions of dollars on the hook. these countries are next to us. if you don't help us end of the world bank which is supposed to be an independent institution helped us, everything is going to go to hell and the american people will suffer. and so is this idea of if you don't help us, the americans will suffer. so, help us but we won't help back. it was manifested by all of these bailouts. and presidents from ronald reagan through bus bush through clinton threw obama who just really got on board with that. >> host: and they play that card told us so that we can help them. >> guest: and that doesn't happen and they are still dealing out the banks in particular because of the way that the federal reserve works. the quantitative easing and the fact that the federal reserve continues to buy the securities from these things six years almost after this crisis haven't? that is a tremendous amount. they are helping everybody we pay their mortgage instead of buying mortgage security from the banks it would be a different stability in the economy rather than the big banks. >> host: let's compare and contrast the regulation put in place in 1930s in the 29 crash versus what we have seen here post 2008 with dodd frank. what is your take on that? >> guest: the act passed was a very clear line between the speculative versions of the services and things that bank could do into the deposit it into the services are provided to the regular individuals and small businesses. there was a very clear distinction. and as i mentioned before, the key bankers of the time, two of them actually, aldridge i mentioned in the james perkins who were friends of fdr that came into the national city bank after the predecessor was such a crook also was on the same page of fdr. one of the fascinating things i found in the research of the fdr papers was that they had meetings -- james perkins was at the white house three days after the inauguration talking to fdr. he would tell his shareholders this is how it is going to go and he did and so did aldrich before the glass-steagall act was actually signed in the summer of 1933. so, that's happened. there was a fine line between getting into traditional services. the bankers were on the same side. the population was on the same side, and things became stable for many decades, several decades after that. you contrast that to what happened in the wake of the 2008 crisis, which has been a much more extensive crisis for the general economy, for the actual on an appointment level, not to those sort of tag line on employment levels, for what was lost to individuals throughout, and relative to the bailouts into the subsidies that have been given since. and dodd frank came along and did nothing remotely like dissecting the speculation from the depositors into the traditional banking activities. the deposits and loans. nothing. it has lots of pages and it does absolutely nothing significant. it is 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. president obama basically said it was sweeping reform. so if you can look at something that isn't sweeping reform and compare to something fdr did that was and say that us with a straight face and have your treasury secretary say that with a straight face, then no. we don't have the leadership that either would do anything, hasn't done anything to stabilize the situation coming yet it is pretending that it has which is more dangerous than not doing anything. and i don't see anyone really coming into play right now in terms of the potential that we have for what is being debated and 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 are left -- even if they are left out of the family connections. even if they have more lobbies in between. there is no demanding. and there is no giving because there is no demanding. >> host: that is a dangerous proposition. just a couple of quotes from the book. what is your take away on the following quotes. he controls the money supply and controls the nation. >> guest: this is what we have right now in the banks today we have to supply the federal reserve is technically in charge of what it has done in its policy is it has bought over $4 trillion worth of securities from the banks or the treasury bonds that go through the banks back to the fed o which they pay interest to the banks and so they have a say in the rates close to 0% for the longest period in u.s. history or in the history of the fed. but the control is retained by the banks that get the money. you couple that with the fact that today there is more concentration on capital in the hands of the fewer banks and fewer bankers running than there's ever been in our history and you're not just controlling the money supply that you're controlling the capital. 84% of the deposits in the country that are insured by the fdic resided the top six things. 85% of the assets. 96% of the derivatives. six banks in the united states. 45% of the derivative exposure in the world. that is a tremendous amount. forget the political financial phone calls to the white house visited invitations. that is a tremendous amount of capital to be in charge of. again, we have only emerged and i mean we have only continued on from the crisis of 2008 to have these sort of statistics we had before and have the banks bigger than they were before controlling more than they did before and that is a scary proposition. >> host: the elephant in the room is too big to fail so what is your take on too big to regulate, prosecute and trust? >> guest: too big to fall and rein in. and as you said before, there are no leadership at the highest echelons to do anything about it >> host: no longer was there the concern of the collaboration of the white house take that quote relative to what we had coming out of world war ii. that is a pretty strong statement. >> host: i don't remember if it was exactly in the 70s that that quote came from or what i was referring to, but the fact is that this alignment that we have used the government for what it's worth and have this relationship where we woul woult into there would be give and take, we don't need that anymore. we will just take the government into the position of having less power as the consolidation of the capital that became more and more concentrated. the powerpc shifted back to -- it had been that way in the panic of 1907 when teddy roosevelt asked j.p. morgan to change the country. even in the late 1980s, the morgan bank had more than the treasury department. it was like a real money and now it's leveraged capital. its alit's all sorts of more complicated money. and with broad power. >> host: often times it is a quite arrogance. there is a quote in the latter part of the book that really grabs me and some people in the public have heard this. that's why i'm richer than you. >> guest: in the internal call the impetus for that quote and basically just what it means and what it says is that this is about a greater good and public interest is sustained by something reasonable and it's about my ego. you bring that into the creation and that is part of why it is also much were dangerous now. it's back into the 30s who had quite a lady go and he was chucked out when it came in under fdr and it didn't work to run the bank anymore. so there was a humility that sort of exist after the depressiodepression and the wart doesn't exist whatsoever anymore. >> host: that is truly troubling. early 19 hundreds we had six large banks dominating the market place. we still have now six large banks but in the interim, there have been endless numbers of mergers. has there ever been a merger that the bank hasn't liked? and whatever happened to the sherman and clayton antitrust act in the world of major banking? >> guest: what happened in the panic of 1907 is very significant because that came as we talked about the federal reserve and then when world war i happened, woodrow wilson and it is an interesting little story in the buck called jack morgan, j.p. morgan's son to the white house after having campaigned on breaking the money trust that was run by people like morgan because there was a war coming on and there was all sorts of speculation in this that at the time why are they getting together, why is morgan at the white house, what is morgan doing and it turned out a couple months later they were trying to figure out how to finance a war and they were very much on the same page and we now have a situation there is nothing to keep that page. >> host: it seems as you were just referencing the percentage of the capital and the deposits and directives and assets with such few hands that it allows for ultimately manipulation and scandalous activities within the markets. >> guest: which is why you need actual well-defined structures to athletes to be unquestionable to at least create less risk to everyone else in the general economy. that should be -- you talk about how the government is supposed to protect the citizens of the country while it's not just about all of the money that he's been thyouspend on military. the government has and should have a refund of the body to protect 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 the government is allowing the president or any president is allowing that to happen is not doing its best by the american people. it is not doing what with the best in the democracy. >> host: then the question is does it really matter who sits in the white house? >> guest: these last several decades yes it really has from this standpoint. you talk about all of the various bailouts and that crisis that has happened in between in the third world debt crisis, the mexican peso crisis, the snl crisis domestically versus in the 2008 crisis, and all of this continues to have been regardless of whether there's a republican or democrat in the white house or regardless the treasury secretary is republican or democrat and who is running the fed. so, it has to matter. >> guest: >> host: nomi this has been fabulous. we have three or four minutes left. let's just touch upon an attractive look forward to the future. obviously a lot of unknowns. we are sitting here at a point in the nations history which have been coming out of the crisis of the late 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 would like to see true leadership coming out of the office with regards to the issues we've been discussing today. i would like to see the return of the glass-steagall act, not a pretender returned, to at least create structural reform because there will always be lobbying and lawyering and personal calls to ask for things. a little more balance between what is required for the stability of the country versus putting everything in all of the eggs into the basket as a stability for the largest banking institutions. and any real strengthening of america from that standpoint. that would be good to see. it would not be good to see another crisis which is very likely what will happen instead because these things aren't happening. i think there's a lot we can learn from our history. it has 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. and there are things that worked worse for the general public we should try not to do. and that was one of my main takeaways aside from the connections and adjusted the anatomy of how the relationships work between the white house and wall street in this country and how they impact policies on the foreign and domestic basis. but also, you know, what makes sense for the general public and the greater public interest and do that more. >> host: those that have failed to learn from history are doomed to repeat it and there's a lot that has been repeated. obviously leading to the crisis of the late in your estimation will it take another crisis to bring about the changes that we haven't seen from this most recent one? >> guest: i think there is 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's tt happened wasn't enough and the fact that we are still subsidizing the banks that were involved is very incredible to me and truly we need to be in a better place. >> host: well, nomi i can't thank you enough for the incredible work you've done in this book. you've done a national service, and for those that are watching the show, please read the book, share it with friends, family and colleagues. congratulations. you've done a fabulous piece of work. >> that was "after words" booktv signature program in which authors of the latest nonfiction books are interviewed by journalists, public policy makers, legislators and others familiar with their material. "after words" airs every weekend on booktv at 10 p.m. on saturday, 12 and 9 p.m. sunday and 12 a.m. on monday. you can also watch "after words" online. go to booktv.org and click on "after words" in the book tv series and topics list on the upper right side of the page. ..

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