'This Week' Transcript: Goolsbee, Brown & Corker

TAPPER: Alexis, you, unlike a lot of business journalists, actually have worked in business. You've done trading at Goldman Sachs, at Morgan Stanley. What do you think of this regulation bill? Do you think the derivatives monitoring and separation that Senator Lincoln is trying to do, do you think that goes too far?

GLICK: Well, look, bottom line is, I think when you look at the derivative equation, do we need transparency? Should there be a central clearing facility? Absolutely. It is without a doubt the wild west. It is all about that shadow banking market, that black market. We have not been able to see who is on the other side of that transaction.

I do believe that it's going too far to say that large financial institutions cannot have a derivative business. Believe you me, I don't want to see one American deposit in this country used as a tool to go out on a proprietary basis for a firm's capital to go out and trade in derivatives. I don't like that. But when you come back to this too big to fail, just to pick up on what you said, the FDIC has done a phenomenal job throughout this financial crisis. No depositor has lost a dime. They've been able to wind down financial institutions in a very, very smart and effective way. The question here on resolution authority is what--

TAPPER: The ability of the government -- I told you I'll do this -- the ability of the government to step in and wind down a financial institution that's failing. Go.

GLICK: Good job! The bill -- the question here is all those other institutions who have a financial arm, as we talked about earlier. It's the GM situations where they have a finance arm, it's the GE Capitals of the world. Where do these guys fit into this equation when they may be in the manufacturing business or in other business?

WILL: That's precisely what worries Republicans. They think this is a thin end of an enormous wedge that is going to get the government deeper into treating capital and credit in this country as a public utility, to be priced and allocated here in Washington, which is, they think, inevitably a recipe for something like crony capitalism. Because you have somewhat not slippery, but open-textured definitions. Non-bank financial institution. Well, GMAC gets General Motors brought under TARP, and in this case, GE Capital would get all of General Electric, or would it? We don't know. Would it be a segment of General Electric brought under this bill?

KRUGMAN: And yet there's no alternative. Meaning if we only protect banks in the traditional sense, which are big marble buildings with rows of tellers, you're missing 60 percent of the modern banking system. The fact of the matter is, there are lots of things out there, money market funds, repo. (inaudible), but things that functionally play the same role as bank deposits, that can destabilize the economy the same way as bank deposits, and so we have to bring those under the umbrella. Now, we can quibble with details, but something like this has to be done.

TAPPER: Let me just interject for one second. We're going to take a quick break. And when we come back, our roundtable will take up Arizona's crackdown on illegal immigrants and what will the impact be on immigration reform. And later, the Sunday funnies.

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