The two-year anniversary of Dodd-Frank has come and gone, and Too Big To Fail is only growing.
Sure, President Obama assured us the sweeping law would reform the sleaze and mindless risk-taking of the banking business — but all it’s given us is the certainty of future bailouts.
Actually, that’s not fair: It’s also producing reams and reams of rules and regulations that force banks out of certain profitable lines of business, like proprietary trading, that had little to do with the shenanigans that led the financial crisis.
But the biggest problem is the expansion of the largest single contributor to the banking collapse: The government’s protection of the remaining big financial institutions, a k a Too Big To Fail.
The reason Too Big To Fail is so dangerous is that it provides a level of comfort to the Wall Street risk takers — enabling them to act like riverboat gamblers and simply bet more and more until the system comes crashing down, as it did four years ago. Why fear, when the taxpayer is on the hook for your losses?
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