WASHINGTON – Federal Reserve Chairman Ben Bernanke told a panel investigating the financial crisis that regulators must be ready to shutter the largest institutions if they threaten to bring down the financial system.
"If the crisis has a single lesson, it is that the too-big-to-fail problem must be solved," Bernanke said Thursday while testifying before the Financial Crisis Inquiry Commission.
Bernanke also said it was impossible for the Fed to rescue Lehman Brothers from bankruptcy in 2008 because the Wall Street firm lacked sufficient collateral to secure a loan. Lehman's former chief executive told the panel a day earlier that the firm could have been saved, but regulators refused to provide help.
The Fed chief presented his analysis of the crisis and views on potential systemwide risks as the panel approaches the end of its yearlong investigation into the Wall Street meltdown.
The financial overhaul law enacted this summer gives regulators the authority to shut down firms when their collapse poses a broader threat to the system. The process resembles the one used by the Federal Deposit Insurance Corp. to close failing banks.
bank holiday is coming
ReplyDelete"If the crisis has a single lesson, it is that the too-big-to-fail problem must be solved,"
ReplyDeleteWhat a criminal twit, first you create TBTF with casino capitalism bailouts, then you have the heroic task of saving america from TBTF!!
As Just another stage of looting the american Treasury and middle class in a collapsed ,failed ,insolvant dollar hegemony system .
America banksters after decades of ponzi scam frauds do not even have an institutional memory left of how to make profits in the real world of industrial capitalism.
thus the problem is twofold Physical after they have deindustrialied america ,its remaining industry mostly dependent on the taxpayer funded military industrial complex and secondly
on a bankster scam culture that really believes that the real source of wealth is a printing press.
And just cannot get it into their thick heads that the rest of the world has given up on credit supply for the great ponzi dollar hegemony system .
As more and more debt is being created for 'saving America from debt ,the american people will require decades of paying off the debts with millions losing their houses and jobs before they can get around to rebuilding a profitable industrial wealth creating industry.
So.
Either a Jubilee year or, the debt enslaved Americans will be confronted with a decades long continuation of the Usury debt shackles system now being imposed by this FED welfare Corporate State Socialisam for the rich ..,
or of turning to the only other alternative of perhaps building a democratic Peoples socialism ?