Bernanke: About 25 mega-firms are systemically significant | WHAT REALLY HAPPENED

Bernanke: About 25 mega-firms are systemically significant

The White House proposal would establish a process to resolve large insolvent systemically significant financial institutions in a way that their collapse does not cause collateral damage to the financial markets.

The goal would be to pay off counterparties of an insolvent institution to deter any such damage arising in the markets. The proposal said the mechanism would be modeled after the Federal Deposit Insurance Corp.'s approach to dismantling insolvent smaller banks, but it would be for larger systemically significant financial institutions.

Webmaster's Commentary: 

In the last financial bailout, money was given to those institutions in which congress members were heavily invested, so that it wouldn't result in severe financial losses for those congress members.

And I would like to remind Bernake of one thing: ultimately, those bailouts are borne by the taxpayers, not the Fed. And We the People have had enough.

If these interconnected companies cannot remain solvent on their own, they should be allowed to fail, as should any other institution.

Small business owners have to make decisions every day about how to survive and stay afloat until things get better. One of those decisions is not spending more money than you have, and not wracking up huge amounts of debt.

Unfortunately, the hubris of larger companies making bad business decisions appears to know no bounds, secure in the belief that the Fed, from henceforward, will not let them fall.