Theodore Roosevelt IV to Moneynews: Downsizing Banks May Cut Risk

Monday, 15 Apr 2013 06:28 AM

By Glenn J. Kalinoski and John Bachman

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Theodore Roosevelt IV, the great grandson of early 20th century trust-busting President Theodore "Teddy" Roosevelt, said some of America’s largest banks might be too big and downsizing may be warranted.

“The five largest banks in the U.S. have more than 60 or 65 percent of the nation’s deposits,” Roosevelt told Newsmax TV in an exclusive interview.

“It appears that if you’ve got a really large bank, they’re hard to manage. Maybe if they were downsized, you could manage them better and the risk would decrease.”

Watch our exclusive video. Story continues below.



Roosevelt, who is managing director at Barclays Capital Corporation, also discussed fracking, the advantages the U.S. has over China and the significance of the U.S. becoming a net exporter of energy.

Editor’s Note: Put the World’s Top Financial Minds to Work for You

“It is pretty darn significant,” Roosevelt said. “One of the things that I would very much like to see is that we’ve got a lot of stranded natural gas resources in Alaska. And the environmental community wouldn’t have a problem brining a pipeline, bringing it down, and, let’s say, we liquefied it. What happens if we sold some of that natural gas to the Asian market, including the Chinese? That would change the nature of our bilateral relationship so it becomes a more stable one and we become closer to being partners instead of having it tilt towards China.”

Roosevelt, who also serves as chairman for the Center of Climate and Energy Solutions, discussed the competitive aspects of alternative energies.

“We’re getting very, very close to that happening,” he said. “We’re now seeing that the megawatt of wind … in Texas is competitive with other sources of energy. We’re seeing solar energy getting down there. We’re going to see the cost continue to come down. A good energy policy, to the extent that you can have one, is one that’s going to encourage diversification, but do so primarily on a market basis.”

When it comes to subsidies, Roosevelt said he would like to see put in place for renewable energy, wind and solar, eligibility for master limited partnerships.

“For a pipeline, whereby you’ve got an entity that raises a lot of debt and it raises equity, but it doesn’t pay a corporate tax,” he said.

“All of the taxes are paid when cash flow is given back to the investors, whether they be debt investors or equity investors. You eliminate a layer of taxes, so their cost [of] financing is substantially cheaper," he said..

"The oil and natural gas industry has used master limited partnerships very effectively. Why should master limited partnerships be solely limited to the oil and natural gas industry?”

Editor’s Note: Put the World’s Top Financial Minds to Work for You

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