How BIG is "Too Big to Fail"?

With the focus on regulating the BIG Wall Street Banks, this is an important question.
How BIG is TOO BIG?

This transcript from last Friday's Bill Moyers Journal can provide some insight.
Watch the Show (recommended) or READ the transcript here:
http://www.pbs.org/moyers/journal/04162010/transcript3.html


According to Simon Johnson and James Kwak, authors of 13 BANKERS,
the limit SHOULD be set at $100 Billion Dollars, and let the Banks themselves figure out how to meet that limit.

Right Now, several of the Banks are over the $Two Trillion Dollar mark, and there is talk in Washington of setting the limit at the existing size which wold be a HUGE Cop Out. This avenue WILL appeal to many Democrats who would like the "sound Byte" of "Capping the Banks" without causing their best contributors ANY discomfort.

Will The Democrats go to bat for the Working/Middle Class (the lower 98%)?
Or, will they hype a phony "reform" that does little to upset the $Money$ Machine?

We will see.


"If we don't fight hard enough for the things we stand for,
at some point we have to recognize that we don't really stand for them."
--- Paul Wellstone

once you get enough politicians in your pocket, you're "too big to fail" regardless of how much you have in assets.

someone would have bought up the profitable pieces. The US government can fail. Very evident by people buying CDS on US treasury notes.

I was strongly opposed to the bailouts, considered it a scam.


This was discussed at the link in the OP.
It is well worth the look.
http://www.pbs.org/moyers/journal/04162010/transcript3.html

The point is, there is NOW momentum for capping the size of these banks.

Without the government guarantees, nobody was going to touch those financial institutions. I don't think a lot of people remember just how broken the wheels of finance were just 17 months ago.

I'm exactly the right size: Too big to fail, too small not to fail. So, since I must succeed or the terrorists win, we need emergency legislation authorizing massive expenditures to make sure I don't fail. Call it the Gratuitous Shoveling of Money out of the Treasury Act.

Wait, that won't work; didn't we already use that legislation title for the Iraq invasion and occupation? Darnie.

I remember the flood of joy that suffused DU that day..

accompany the bail out or the impetus for reform would be lost. Sure enough, that's what happened. The bail outs worked. The financial markets were restored to normal function and the government didn't lose much at it either. However, the best moment for reform was lost because the politicians did not act.

There will be no meaningful regulation, the owners don't want it.

...is that the Bailout Money was NOT used for the purposes it was demanded.
If the money was NOT used for the purposes stated in Paulson's Extortion Demand,
then the threat was bogus.
QED

:-)