Too Big to Exist

Here’s a list of biggest US Banks. Top 3 are:

  1. Bank of America
  2. JPMorgan Chase
  3. Citigroup

All have assets of approximately two trillion dollars.

These banks are companies that play with risk and reward. It’s simple math. If you add in the¬†possibility of a bail-out by the U.S. government then the risk is significantly reduced for companies (such as these banks) that the government considers “too big to fail”.

Just like we enforce the break-up of monopolies, the regulatory power of the government needs to break up companies which are “too big to exist”. But more importantly, it needs to prevent the creation of new such companies through some regulatory mechanism such as a “too big to fail” tax. Tax “excessive” size. If you don’t like it, then the alternative is we have to let these giants fail, and suffer the consequences on the financial system. Period. Otherwise, the tax payer incentivizes “excessive” risk-taking.

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