I am waiting and watching for what Barney and Timmie have up their sleeves now, but we have a hint of what is coming Thursday, and I am sure the banks are REALLY not going to like this. I know that, as a little person, giving this government any more power is more than a bit psychotic.
In a move mirroring regulations being discussed in the UK, the Obama administration will this week back plans by the House of Representative’s Financial Services committee to introduce a bill to ensure that major banks and non-bank institutions cannot become “too big to fail”.
The legislation will force institutions to boost reserves and make it harder for them to leverage against their own assets. It will also force large institutions with the potential systemic risk to create and possibly publish “living wills” which would set out how they could be wound down in an orderly manner.
The bill would potentially mean that were a large company to collapse, its bankruptcy would be controlled by the US government rather than its creditors. (emphasis mine)
How un-American is that? Do you think that Americans are going to be rushing to invest? Does it remind you of the inception of the Federal Reserve System?
It is expected that the bill, written in consultation with officials from both the Federal Reserve and the US Treasury, is to be published in the next few days. Treasury Secretary Tim Geithner is then expected to endorse it on Thursday.
Please keep your eye on the ball when it comes to the healthcare bill, but definitely check back in on what Barney and Timmie are up to.