Choosing the Road to Prosperity Why We Must End Too Big to Fail

The too-big-to-fail institutions that amplified and prolonged the recent financial crisis remain a hindrance to full economic recovery and to the very ideal of American capitalism. It is imperative that we break up the big banks...

Every day I'm reminded of why we don't have the power to change the laws that govern this world.

We must instead live in harmony with those laws or we will be given "corrections" until we do, but we, children that we are, suck at even figuring that out.

Arrogantly claiming we're too big to fail only attracts the wrong kind of attention from the gods of destiny who delight in having sport with such fools.

The cosmic response to "Too big to fail" is "I hope you enjoy pain".

That this comes from the Dallas Fed is only slightly remarkable. For “Fed Watchers,” the history of the Dallas Fed since 2008 is that they have had some of the sounder thinking.

The trouble is, when the bankers implode, the NY Fed is at the driver’s wheel of the Federal Reserve. The Dallas Fed is pretty much just a spectator.

It isn’t about “spreading the wealth around” when we talk of breaking up the five “TBTF” banks.

It is a recognition that they’ve completely captured the regulatory and law enforcement system to their benefit. The behavior of the largest banks is now entering the territory of racketeering, ala “Nice economy you have there. It’d be a shame if anything happened to it....” is what the bankers tell the SEC when the SEC tries to effect some enforcement.

There are so few people in Congress who even understand how the US financial system works, they’re not competent to write the laws and regulations. They believe what the bankers say, almost without question. This is why we’re in the situation we’re in.

The only guy in the election from the get-go who understood the banking situation even marginally was Thad McCotter. No one paid any attention to him. The only guy in the US Senate who understood the banking system was Ted Kaufman, the Democrat appointed to fill Biden’s seat until a new election, and he’s gone from the Senate back to the private sector.

The future of the US economy looks to be about the same as Japan’s now, where they keep issuing more and more debt to prop up their economy and their bankers. Japan has a debt:GDP ratio of over 230%, but the only reason they get away with it is because most of their debt is owned domestically by “Mrs. Wantanabe” (the equivalent of “Jane Doe” in Japanese reporting).

In the US, we don’t have any ability to absorb the kind of debt that is being issued to prop up the bankers.

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