U.S. Seeks Expanded Power in Seizing Firms

[biopowertoday]

Source: nytimes




http://www.nytimes.com/2009/03/25/business/economy/25web-bailout.html?_r=1&th=&emc=th&pagewanted=print

March 25, 2009
U.S. Seeks Expanded Power in Seizing Firms
By EDMUND L. ANDREWS and ERIC DASH

WASHINGTON — The Obama administration and the Federal Reserve, still smarting from the political furor over the bailout of American International Group, began a full-court press on Tuesday to expand the federal government’s power to seize control of troubled financial institutions deemed too big to fail.

In his news conference on Tuesday night, President Obama said the government could have handled the A.I.G. bailout much more effectively if it had had the same power to seize large financial companies as it did to take over failed banks.

“It is precisely because of the lack of this authority that the A.I.G. situation has gotten worse,” Mr. Obama said, predicting that “there is going to be strong support from the American people and from Congress to provide that authority.”

Earlier on Tuesday, the Treasury secretary, Timothy F. Geithner, offered a proposal that would allow the government to take control, restructure and possibly close any kind of financial institution that was in trouble and big enough to destabilize the broader financial system.

The federal government has long had the power to take over and close banks and other deposit-taking institutions whose deposits are insured by the government and subject to detailed regulation.

But the Obama administration and the Fed would extend that authority to insurance companies like A.I.G., investment banks, hedge funds, private equity firms and any other kind of financial institution considered “systemically” important. That would let the government for the first time take control of private equity firms like Carlyle or industrial finance giants like GE Capital should they falter................

Read more: http://www.nytimes.com/2009/03/25/business/economy/25web-bailout.html?_r=1&th=&emc=th&pagewanted=print

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sounds like nationalization to me. the Swedish model

which is fine by me.

[tekisui]

1. It's needed.

[Hope And Change]

2. Agreed.

[biopowertoday]

3. I think so too.

[GinaMaria]

4. let's just do it. It can't be any worse than what we have now and

at least holds the hope of being better.

[wroberts189]

5. very interesting... nt