Citigroup was the only "too big to fail" commercial bank that the government rescued

[FarCenter]

Citigroup - commercial bank - rescued by government
AIG - insurance company - rescued by government
GMAC - auto and mortgage lender - rescued by government
Chrysler Financial - auto and mortgage lender - rescued by government
Lehman - investment bank - went bankrupt
Bear Stearns - investment bank - merged into JP Morgan Chase
Washington Mutual - thrift - merged into JP Morgan Chase
Merrill Lynch - investment bank - merged into Bank of America
Countrywide - thrift - merged into Bank of America
Wachovia - commercial bank - merged into Wells Fargo
National City - commercial bank - merged into PNC
IndyMac - thrift - resolved by FDIC

Any others?

Bank of America would not have needed a government rescue but for the government's insistance that the Merrill Lynch deal go through.

[still_one]

1. Why do you think they made Goldman a bank? Because they needed money

to rescue them

The reason they saved Goldman over the others was because our friend paulson and associates wanted to get rid of the competition

[FarCenter]

3. As you note, Goldman wasn't a commercial bank

Goldman was an investment bank and it would have survived without assistance after AIG was rescued and the derivatives market stabilized.

Pretty much the same situation for Morgan Stanley.

Others, like GMAC and Chrysler Financial were also converted to commercial banks so they could be rescued.

But Citi was the only financial institution that both was a commercial bank prior to the crises and would have failed.

So I don't see how the Volcker Rule prevents future crises which will undoubtedly arise in the non-commercial bank part of the financial industry.

[SharonAnn]

2. And the Glass-Steagall act was repealed in order to allow CitiBank to become CitiGroup

[TheKentuckian]

4. Right now a bank is a bank

[JDPriestly]

5. I believe you have to view this in an international context.

The US was not the only country rescuing banks. Our banks owed a lot of money to some big foreign banks including Deutsche Bank and Societe Generale. Our investment and commercial banks had sold interests in derivatives that were theoretically valued at more than the total GDP of the international community. I may be wrong, that is my understanding.

As I recall, we were told that our banks in general were about to be refused access to the overnight credit that makes international banking transactions and other banking transactions possible.

Am I wrong about these facts?

We had to rescue the banks so that they could once again be eligible for the overnight loans among other things.

Also, as Elizabeth Warren pointed out on Thom Hartmann, many of the banks are still carrying subprime mortgages on their books, so it is really too soon to know which ones are/were solvent. There's a whole lot of lying going on. Be careful out there.

[kudzu22]

6. Don't forget about

Fannie & Freddie. Bigger than the rest of them put together.