"If anyone thought the biggest five banks were behemoths before their bailout, numbers released by the Federal Reserve show that JPMorgan & Chase, Bank of America, Citigroup, Wells Fargo and Goldman Sachs now hold $8.5 trillion in assets, or about 56 percent of U.S. annual economic output. That's compared to only 43 percent five years ago, prior to the 2008 bailout.
It doesn't appear the lessons of the bailout have been learned either. In fact, Kevin Warsh, a former member of the Fed's Board of Governors, thinks financial markets "have come to believe that what the government did in 2008 and 2009 isn't a one-time deal [and] that the government will somehow come to the rescue of these big financial firms." On the other hand, more small banks are disappearing due to forced consolidation or acquisition by the largest five, as the 6,291 commercial banks operating today are fewer than half of the number present in 1984. Moreover, these banking giants are expanding their international assets as they take advantage of government austerity measures that affect European lenders. With each fire sale acquisition overseas, the global financial house of cards grows taller.
It's nearly a foregone conclusion that "too big to fail" is still in effect, with the only question becoming how much more taxpayer money will be thrown into the fire. After spending $245 billion to bail out the financial system in 2008, it's hard telling how many more billions another TARP-style bailout would cost and when the bill will come due."
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