It looks like you're using an Ad Blocker.
Please white-list or disable AboveTopSecret.com in your ad-blocking tool.
Some features of ATS will be disabled while you continue to use an ad-blocker.
(visit the link for the full news article)
NEW YORK (Reuters) - The U.S. government's latest bank rescue, this time a multi-billion dollar lifeline handed to Bank of America, has led to more talk of what once would have been unthinkable -- European-style nationalization of major American banks.
Few see the government nationalizing the entire banking system the way Sweden did in the 1990s, but the U.S. is growing more willing to put significant pressure on the largest banks.
Originally posted by xoxo stacie
In essense BUT the Gov does not "yet" have enough of a controling amount to completely take over.
My problem is this...what does the Federal Reserve a PRIVATELY owned bank have to do with our decsions about who to save and who to let fall? What it isnt okay for them to get it stuck to them like the rest of us? is my point
US Proposes Overhaul of Banking System
March 31, 2008
In what is being hailed as the largest regulatory change in the US banking system since the great depression, Treasury Secretary Paulson presented a sweeping proposal today detailing the planned changes. In order to properly regulate the financial stability of the US as a whole, ...
the Fed should take a more proactive approach to managing the liquidity and leverage of US financial institutions.
The sweeping plan has yet to be set into place by congress, and is expected to undergo intense scrutiny before it is adopted.
WASHINGTON: Last fall, as Federal Reserve and Treasury Department officials rode to the rescue of one financial institution after another, they took great pains to avoid doing anything that smacked of nationalizing banks.
They may no longer have that luxury. With two of the nation's largest banks buckling under yet another round of huge losses, the incoming administration of Barack Obama and the Federal Reserve are suddenly dealing with banks that are "too big to fail" and yet unable to function as the sinking economy erodes their capital.
Particularly in the case of Citigroup, the losses have become so large that they make it almost mathematically impossible for the government to inject enough capital without taking a majority stake or at least squeezing out existing shareholders.