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Old 03-22-2009, 04:46 PM
 
Location: Virginia
931 posts, read 3,469,342 times
Reputation: 447

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Heard this on the radio this afternoon.

How do you feel about this?

I am personally a fan of smaller businesses. Only the strong will survive.

Bigger = Stronger = More Powerful = More out of control = Too Big to Manage?

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Old 03-24-2009, 12:43 PM
 
3,553 posts, read 6,940,558 times
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TR broke up the trusts and IMO the anti trust division of the Justice Department has been asleep at the switch for too long. Break em up. Letting investment banks get into retail banking and vice verse as well as letting insurance companies, AIG get into other stuff means that the people who should be overseeing them AREN'T.

golfgod
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Old 03-24-2009, 01:40 PM
 
Location: Aloverton
6,564 posts, read 12,308,108 times
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I felt strongly about this well before now. There needs to be no company too big to fail, even if that means they must be broken up by force like the Bell system was. Let them whine about socialism all they want, but the fact of the matter is that the national interest is of greater importance than their desire to get bigger, bigger, bigger.

Of course, had we reined in the M&A frenzies over the past quarter century, this might not have been such an issue. But that would have been socialism. It's kind of funny. It's like 'socialism' was an old baseball bat that got put in the garage in 1991, dug out of the closet to use to beat up anyone who doesn't embrace laissez-faire avarice as the world's best social system.
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Old 03-24-2009, 08:45 PM
 
Location: Virginia
931 posts, read 3,469,342 times
Reputation: 447
Is it me, or do we seem to have patterns of this back and forth?

Financial Services Institutions (FSI) split up because they are too big to manage, then FSIs build back up again because they want market share and want more profit.

From a community bank perspective, the smaller banks won't last against the big banks, but eventually people will get tired of the big banks or FSIs because they are too hard to manage and screw everything up, so they go back to small community banks.

Perhaps the economy will take care of itself over time, without the use of government?

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Old 03-25-2009, 02:59 PM
 
823 posts, read 1,991,876 times
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Quote:
Originally Posted by oleo View Post
Is it me, or do we seem to have patterns of this back and forth?

Financial Services Institutions (FSI) split up because they are too big to manage, then FSIs build back up again because they want market share and want more profit.

From a community bank perspective, the smaller banks won't last against the big banks, but eventually people will get tired of the big banks or FSIs because they are too hard to manage and screw everything up, so they go back to small community banks.

Perhaps the economy will take care of itself over time, without the use of government?

It's not the size of the bank. There are limits in place over how many deposits a bank can have. The problem, as was pointed out earlier in this thread, is allowing investment banks to merge with retail banks and insurance companies etc etc etc. During the Depression, a law was passed which banned those kinds of mergers. That was repealed in 1999. That allowed CitiBank to become CitiGroup, AIG to become add "investment bank" to its title, etc etc etc and caused these things to become "too big to fail". I agree with the OP, if something is "Too big to fail" it is "too big to exist". Break them up. They won't be broken up organically because there is too much money involved and too much incentive to keep it together and get bigger, especially when the govt comes to their aid and keeps them afloat. No, nothing short of reinstating the law banning these types of alignments will solve the problem.
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