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Break Up The Banks? Here’s An Alternative

Sunday, February 12, 2012 - 10:21 AM
Here's an interesting alternative described in this New York Times article for breaking up the too-big-to-fail banks:
There is a better alternative: expanding the liability for major financial institutions. If a shareholder invests a dollar in a big bank, why not make that shareholder liable for the first $1.50 — or more — of losses as insolvency approaches? In essence, we would be making the shareholders liable for the costs that bank failures impose on society, and making the banks sort out the right mixes of activities and risks.

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Ken TuminKen Tumin5,442 posts since
Nov 29, 2009
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