Who's Too Big To Fail? Damn Near Everybody

Discussion in 'Politics' started by Wiseacre, May 24, 2012.

  1. Wiseacre
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    Wiseacre Retired USAF Chief Supporting Member

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    Curious as to how many of you realize that the definition for who is too big to fail (and therefore eligible to be bailed out) has been expanded. I thought that when Dodd-Frank came out it would be designed to preclude any more bailouts. But no, the federal gov'ts Financial Stability Oversight Council is about to designate certain non-banks as "Systemically Important Financial Institutions" (SIFIs). Insurers, financial holding companies, hedge funds, securities firms, maybe even money market mutual funds and private equity firms could be bailed out with taxpayer money if they are seen as a threat to the financial security of the USA.

    Why is that a big deal? Among other reasons, a company backstopped by the federal gov't enjoys less credit risk and a competitive advantage over those who aren't. Do you see the greater possibilities for more crony capitalism? Once again we are favoring the largest corps over the smaller ones, IMHO not the direction we need to be going in.


    The above is based on an op-ed by Peter J. Walison in todays WSJ print edition. Far as I know, it's propriety and I can't provide a link.
     
  2. The T
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    The T George S. Patton Party Supporting Member

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    The entire Republic...but we have Gubmint picking winners and losers.

    NOT good.
     
  3. BreezeWood
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    BreezeWood VIP Member Supporting Member

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    if they are seen as a threat to the financial security of the USA.


    Take Credit - refine the process for doing something positive rather than the Policies and Principles (Republican Administration) of "free" market / no oversight that inspired the problems in the first place.
     
  4. The T
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    The T George S. Patton Party Supporting Member

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    Government shouldn't be in the business of picking winners and losers.
     
  5. BreezeWood
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    BreezeWood VIP Member Supporting Member

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    managing the economy is the gov'ts business - weeding the crop when necessary has nothing to do with winners and losers ...
     
  6. Wiseacre
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    Wiseacre Retired USAF Chief Supporting Member

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    I kinda think it does, when gov't decides who gets watered and fed and who gets nothin'. Look, oversight is fine to make sure there's no lyin' and cheatin' going on and all information is made available for people to make their decisions. But this crap about bailing people out for screwing up just cuz they're too big is BS.
     
  7. The T
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    The T George S. Patton Party Supporting Member

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    Agreed. We have laws that dictate bankruptcy. Government needs to keep thier snoots OUT of the process and let the market work.
     

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