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Too Big to Fail is still a problem

February 19, 2011

Remember some months back when I posted this? Financial reform made easy: eliminate Too Big to Fail.

Turns out I was right and a nationally renowned economist agrees with me.  Yep, Robert Reich – former Labor Secretary to President Bill Clinton and former trustee of the Social Security Trust Fund said essentially the same thing I said. (of course he said it better, but he’s got a research staff and video production team and i don’t)

1. Banks should not be allowed to be “too big to fail” and if they get that big, break ’em up.

2. Banks should be separated into 2 categories – risky investment banks and traditional old savings and loan type banks.

Reich added one important point that I didn’t – Wall Street pay should be linked to long term performance results, not gaming the stock market in the short term.

Sometimes it feels good to know that common sense is really all the smarts we need. Now if only the national news media would start covering – and uncovering through investigative reporting – the collective common sense ideas that we’ve already got!! Oh, but wait, they can’t bother doing that. The Kardashian sisters are probably going to appear in public without panties again soon, and we all need breaking news of that.

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