Sunday, October 17, 2010

Too Big to Fail - Again: Part 2

A CNBC editor comments:

The put-back crisis is not driven by economics. It is driven by legal rights. And there’s simply zero probability that the politicians in Washington are going to let Bank of America or Citigroup or JP Morgan Chase fail because of a legal issue.


Politicians will not let the financial stability of the largest bank in the nation be threatened by contractual rights.


All the screwed up paperwork, lost notes, unassigned security interests will be forgiven by a legislative act.


If you’re skeptical about the possibility that this will happen, you have greater faith than I do in the ability of the political system to resist doing favors for bankers.


Not me.

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