AND THE BEAT (AS IN BEAT-DOWN OF THE AMERICAN CITIZEN) GOES ON
What does this mean, you may ask? It's simple really. The Federal Reserve (a "quasi-governmental" entity with private components, headed by non-elected governors and non-elected chairman) declared that AmEx is a bank holding company.
Just as it declared that investment banks like Goldman Sachs are bank holding companies.
And what does it mean to such a company when the Federal Reserve unilaterally declares it to be a bank holding company? That's simple too: access to cheaper credit, loosened rules for issuing stock, tax-free treatment of certain debt, etc.
I guess AmEx is "too big to fail." Incidentally, AmEx happens to be an unsecured creditor to lots of consumer debtors in a time when consumers are reducing their debt financing and finding it harder to pay off existing debt.
Funny thing is, even though we're paying to keep AmEx and Goldman Sachs and AIG afloat, through debt now, taxes soon, and inflation later, I can't seem to remember when I got to vote on which companies qualify as "too big to fail."
Taxation. Representation. You know the rest.