Is the age of bailouts over?

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Reuters is reporting that regulators on Wall Street have instructed the nation’s five biggest banks to begin making plans for how each would deal with another financial crisis and prevent an all-out collapse, hinting that government bail out may not be an option in the future.

These instructions are part of an ongoing two-year program, largely kept secret, to prevent a repeat of the 2008 financial crisis. Banks have also been forced to create “living wills” so that regulators know exactly how to unwind them should they fail in the future.

Of course, the best way to prevent another financial crisis isn’t to make Wall Street’s giants write living wills, it’s to break up Wall Street’s giants – and put in place regulation like Glass-Steagall to stop the banks form gambling with your money. It’s the least our lawmakers can do to turn banking back into the safe, useful, and boring industry is used to be in America.

Thom Hartmann Administrator's picture
Thom Hartmann A...
Dec. 29, 2009 10:59 am


Or nationalize them altogether. Seemy blog at

pshakkottai's picture
Jul. 11, 2011 11:27 am

Europe is thinking of this:


To prevent all this economy stalling circus, money losing bank corporations should have been allowed to fail, until they were bought back (by the government, if nobody else, like a crazed sheik, moved in first), for cents on the euro, pence on the pound, pennies on the dollar.

The correct course would be for the British government to coolly announce that they would stop helping banks such as RBS, and threaten to take away their banking license. After such a menace, loud and clear, the stock prices of the banking corporations would collapse, and the banks could be nationalized cheaply. Meanwhile a PUBLIC bank to lend to SMEs ought to be created (say with the 80 billion pounds brandished to help existing banks).

The same applies everywhere." from

pshakkottai's picture
Jul. 11, 2011 11:27 am

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