Hello:

The more we do something wrong, the MORE we CONTINUE to do something wrong. Could it be that the banks are running the show?

Too big to fail, means EXACTLY that. It means that we WILL bail them out again, or suffer another great depression. It can't mean anything OTHER than that.. It's like saying we have a BOMB in our midst that went off once before. Buuuut, we ain't going to disarm it. How stupid is that? Let me ask that again. How stupid is that?

I say this, because our banks are teetering again. They're doing that because we DIDN'T fix what was wrong. That COULD be because Obama took the banksters INTO his administration. WHEN they fail, and they will, we're going down too. That's what TOO BIG TO FAIL MEANS.

I suggest again, that we get MONEY out of politics, because as long as the banks can BUY what they need from government, what makes you think they won't?

Buy gold.

excon

Let them fail then . I still say that if the FDIC was changed to only insure banks then the so called "too big to fail" institutions would naturally break up into smaller institututions.

You will never get money out of politics because it costs money to get a candidate's message out to the public. What you are really saying is pick my pocket through public funding to finance everyone's campaign whether I like the candidate or not. That is a sure way to ensure a permanent governing class . When the politicians can decide who gets public funding you will have incumbent job security .

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Originally Posted by tomder55

What you are really saying is pick my pocket through public funding to finance everyone's campaign whether I like the candidate or not.

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Hello again, tom:

If I had a choice between picking your pocket to pay for public campaigns, or letting the rich decide who wins, I'll opt for picking your pocket...

But, of course your pocket is picked for roads you'll never drive on or wars you don't agree with, or even loans made to green energy companies...

There are SOME things that should remain in the public realm and our elections are one of them.

excon

Absolutely disagree . If a candidate can't solicit funding and obtain it then they don't deserve to be the candidate . I will say it again...

That is a sure way to ensure a permanent governing class . When the politicians can decide who gets public funding you will have incumbent job security .

Quote:

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Originally Posted by tomder55

Let them fail then .

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Hello again, tom:

Given that they're TOO BIG to fail, we're going to go down with them... Wouldn't it have been better to break them up in to smaller banks, like I suggested?? Then they could fail and we could thumb our noses at them... We can't do that now... We're in big trouble again.

excon

Let them fail Ex, let them fail. It will cost some big end investors some money but in the end you will be better off

Hello again,

So, the consensus is to let them fail, and by virtue of the fact that they're too big to fail, we're going down with them..

Nobody, except me, thinks we should break them up, so that when they fail, they don't TAKE US DOWN WITH THEM..

I don't know.. Am I nuts?

excon

My solution would break them up. You do understand that no one looking for deposit insurance would put their money in an institution selling securities . Naturally there would then be a market for a safe bank for depositers looking for the security of having their money insured . The financial institutions ;not having those customers would divest of the savings and loan business and would become smaller as a result . The banks that branch off would do insured savings instruments and would invest their customers money in small business loans and consumer credit.
The consumer in turn would have a choice in putting their money in insured institutions or ones where they know their money is at a greater risk.

The effect is what you say you want ;without the heavy hand of government involved beyond a minor adjustment to existing rules .

Ex what usually happens is when they fail their business is taken over, usually under favourable terms but with some loss of employment and shareholdervalue.

It doesn't necessarily affect you unless you are an investor, you will see a blimp in the market for a few days but the only other organisations affected are those which had capital involved directly.

Sooner or later the pain must be felt.

Yup ;creative destruction is necessary in a capitalist system. It is through government intervention that companies become too big to fail. The idea that a company can be bailed out creates a situation that encourages reckless and irresponsible risk taking . By guaranteeing the survival it encourages the ignoring the moral hazards inherent in excess risk taking .

Quote:

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Originally Posted by tomder55

The effect is what you say you want ;without the heavy hand of government involved beyond a minor adjustment to existing rules .

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Hello again, tom:

Ok, who besides you is proposing it?

excon

I've heard some economists suggest it but no one in government or running. Just the opposite is happening . FINREG I believe expands FDIC coverage to riskier instruments . That I believe is a big mistake.