Should financial service companies that are too big to fail be split into smaller companies?

[Boojatta]

AT&T was split into "Baby Bells."

[Common Sense Party]

1. I vote no; they can just fail and shareholders can take their lumps.

AT&T was broken into baby bells because it was a de facto monopoly in many places.

The megabanks and investment houses are not monopolies.

[Boojatta]

4. If they are considered too big to fail, then politicians won't let them fail.

[protocol rv]

5. Unfortunately, historically they are not allowed to fail

Your comment would be right, but there's a slight problem, most of the time, they are not allowed to fail because they are so large they may caused widespread damage to the economic system. One option would be to strengthen the system so it can take the impact, but that's probably more inefficient than breaking up large financial institutions. I vote for breaking them up, then they can be allowed to fail.

There is a problematic issue here, if a company grows on its own to an excessive size, then why should they be punished? But I've noticed many of the behemoths achieved their size by inorganic means, they purchase others or merge. So to stop the problem from arising, it's fairly easy to avoid it by forbidding mergers and aquisitions by companies beyond a certain size - period. Another way to reduce their impact on the economy is to require them to increase their cash holdings as they grow in size. Given that choice, management would probably buy back shares rather than loan the cash.

[LetsgoWings13]

2. I voted no as well...

but because I dont wanna bail out a bank if they have stupid people running it into the ground!

[Toucano]

3. Other: The repealed Glass-Steagall Act would keep the hands in their own pies

and we wouldn't have to worry about "too big to fail".

[DailyGrind51]

6. Break 'em up! Shareholders are pensioniers and labor unions.

[Greyhound]

9. And what a happy coincidence that was.

Who would have thought that, after allowing the parasites to steal your pension and then forcing you into the "Stock Market", that then you would feel compelled to support giving them trillions more of your future dollars to buy their markers for the bad bets they made (and took hefty commissions on)?

Why, nobody could have predicted this situation.:dunce:

[OmahaBlueDog]

7. I'd like to see an end to 50-state banks.

I don't object to multi-state banks, but there should be a limit (say 5 states). This way, we can have banks that serve NY/NJ/PA/CT or MD/VA/WV and DC, but not create behemoths that drag down the entire economy.

[Boojatta]

8. Kick for votes and comments.

[Liberal_in_LA]

10. no, just stop bailing 'em out.